India 10Y Yield Extend Gains

The yield on India’s 10-year G-Sec rose to around 6.7%, extending gains for the third consecutive session, as surging oil prices and prolonged geopolitical tensions fueled selling pressure. Crude prices climbed sharply after President Donald Trump signaled that the standoff with Iran could continue for several more weeks, raising concerns over imported inflation. The move was compounded by a weak Indian rupee and sustained foreign portfolio outflows, which reduced demand for local debt. Gains in yields were partly offset by active intervention from the Reserve Bank of India, which has stepped up bond purchases to stabilize markets. Traders expect the benchmark yield to trade within a 6.62%–6.72% range in the near term, with oil prices and geopolitical developments likely to remain the main drivers.

The yield on India’s 10-year G-Sec rose to around 6.68%, extending gains for a second straight session, as a sharp jump in oil prices and higher US yields spurred selling. Brent crude topped $100 per barrel after Iran sank two Iraqi oil tankers, intensifying concerns about imported inflation and rupee depreciation in India, which relies heavily on energy imports. The 10-year US yield also neared 4.25%, adding external pressure on domestic long-term rates and prompting cautious trading among investors. The Reserve Bank of India has intervened in the secondary market, buying bonds to help cap the rise in yields, while long-term investors purchased net 98 billion rupees of government debt over the past two sessions. Despite these measures, traders remain wary of further volatility as energy prices stay elevated and global rates trend higher. The rupee has hovered near record lows, reflecting continued market sensitivity to oil shocks and geopolitical tensions.

The yield on India’s 10-year G-Sec fell to around 6.67%, easing from the previous session, as a sharp pullback in crude oil prices supported demand for sovereign debt. Brent crude retreated to about $88 a barrel after US President Donald Trump signaled the Middle East conflict with Iran could end soon, easing fears of prolonged supply disruptions and inflation risks for India, one of the world’s largest crude importers. Lower energy prices helped improve sentiment toward Indian assets, with the rupee also strengthening. Support also came from the Reserve Bank of India, which has been conducting open market purchases of government bonds to help stabilize the debt market. Meanwhile, traders remained cautious ahead of a large supply of state debt, with Indian states scheduled to raise roughly INR 460 billion through bond sales, limiting further declines in yields.