India 10Y Yield Extends Gains as Oil Prices Surge
The yield on India’s 10-year G-Sec edged higher to around 7.46%, extending gains for another session as surging oil prices weighed on investor sentiment, while falling U.S. Treasury yields limited the increase. Brent crude climbed above USD 114 a barrel to a five-month high following Houthi attacks on Saudi Arabia, raising concerns over supply disruptions. As India imports nearly 90% of its oil requirements, sustained price increases threaten to widen the import bill, fuel inflation, pressure the rupee, and weaken public finances. Meanwhile, investors remained cautious ahead of a INR 330 billion government debt sale, keeping demand subdued. The benchmark 6.94% 2036 bond yield rose, nearing the 7.50% level. However, U.S. Treasury yields fell below 5% amid weaker economic data, an equity selloff, and concerns over the returns on AI spending and its growth implications.
The yield on India’s 10-year G-Sec edged higher to around 7.46%, extending gains for another session as surging oil prices weighed on investor sentiment, while falling U.S. Treasury yields limited the increase. Brent crude climbed above USD 114 a barrel to a five-month high following Houthi attacks on Saudi Arabia, raising concerns over supply disruptions. As India imports nearly 90% of its oil requirements, sustained price increases threaten to widen the import bill, fuel inflation, pressure the rupee, and weaken public finances.
Meanwhile, investors remained cautious ahead of a INR 330 billion government debt sale, keeping demand subdued. The benchmark 6.94% 2036 bond yield rose, nearing the 7.50% level. However, U.S. Treasury yields fell below 5% amid weaker economic data, an equity selloff, and concerns over the returns on AI spending and its growth implications.