India 10Y Yield Rises Despite RBI Intervention

The yield on India’s 10-year G-Sec hovered around 6.9%, edging lower amid renewed buying interest as softer crude prices eased concerns over inflation and fiscal pressure. Sentiment improved after oil retreated on hopes of renewed US–Iran diplomatic engagement, even as uncertainty persisted over the Strait of Hormuz and the durability of the ceasefire approaching its expiry. Downward pressure was supported by expectations that lower energy costs could ease India’s import burden and improve macro stability. However, further declines were limited as volatile oil prices kept inflation risks in focus. Foreign investor outflows persisted, though at a slower pace, with positioning remaining highly sensitive to shifts in crude and geopolitical developments. Overall, yields are expected to remain range-bound within 6.85%–7.00%, as markets look to the Reserve Bank of India’s policy minutes for clearer signals on the inflation-growth outlook.

The yield on India’s 10-year G-Sec hovered around 6.9%, pausing its recent decline after briefly touching a three-week low, as investors reassessed risks tied to global developments and upcoming domestic supply. Concerns over the US–Iran conflict remained a key overhang, even as reports indicated that the two sides are considering a short-term extension of their ceasefire to allow more time for negotiations. Crude oil prices, with Brent holding near $95 per barrel, added to the cautious tone. Elevated energy costs remain a key concern for India given its heavy reliance on imports, with higher oil prices historically feeding into both inflation expectations and pressure on bond yields and the currency. At the same time, traders positioned ahead of a fresh government debt auction scheduled for Friday, where New Delhi plans to raise INR 320 billion through sales of five- and 40-year securities, adding to near-term supply pressure in the market.

The yield on India’s 10-year G-Sec rose to around 6.9%, extending gains from the previous week as a sharp rise in oil prices and renewed geopolitical tensions triggered broad-based selling in domestic bond markets. Sentiment weakened after Brent crude jumped over 7% to $102.2 per barrel, following the US move to begin a blockade of all maritime traffic entering and exiting Iranian ports after weekend talks failed to reach a peace deal, raising fears of renewed supply disruptions through the Strait of Hormuz. The selloff was further amplified by foreign portfolio outflows, with overseas investors continuing to trim exposure to local debt amid uncertainty over growth and inflation dynamics. Traders now expect the benchmark yield to trade in a 6.85%–7.00% range, as markets remain closely attuned to oil price movements, capital flows, and evolving geopolitical risks. Debt markets will be closed on April 14 and will resume trading the following day.