13.07.202607:27:55UTC+00India 10Y Yield Rises on Oil Surge

The yield on India’s 10-year government security edged up to about 6.74%, halting its recent decline as rising geopolitical tensions in the Middle East pushed crude oil prices and US Treasury yields higher, dampening appetite for sovereign debt. Brent crude advanced after Iran widened its strikes to Qatar and the United Arab Emirates in retaliation for new US attacks, intensifying worries over energy supply disruptions and inflation. Investor sentiment was also restrained ahead of India’s June inflation release, with CPI projected to rise to 4.3% from 3.93% in May, breaching the RBI’s 4% target for the first time in 16 months amid elevated food and fuel costs, the Iran conflict, and a weaker monsoon. At the same time, optimism over India’s potential inclusion in Bloomberg’s Global Aggregate Index continued to support the market, following foreign investors’ purchases of $4.1 billion in government bonds via the Fully Accessible Route over the six weeks starting June 1.