India bonds slip on oil spike, bargain hunters curb losses

Benchmark Indian 10-year bond yield rose 1.5 basis points to 6.8078% as Brent crude climbed 1.3% to a six-week peak of $92.2, driven by US-Iran tensions and Red Sea shipping disruptions for oil tankers bound for China and India. Rising oil prices are expected to widen India's trade deficit and stoke inflationary pressure, though state-run bank bids and the Reserve Bank of India's foreign exchange measures, which mobilised $20.72 billion between June 8 and July 17, capped losses. The 10-year US Treasury yield hit a two-month high of 4.63%, weighing on emerging market debt, while traders await an update on India's inclusion in the Bloomberg Global Aggregate Index expected mid-2026.