Oil rally weighs on Indian bonds, value buyers limit fall

Indian government bond yields hit a six-week high as oil prices surged 3.3% to $94 per barrel on supply fears linked to US-Iran tensions and Houthi attacks on Saudi crude carriers. The rupee weakened to a two-month low of 96.5650 per dollar, while benchmark equities posted their biggest single-day loss in two weeks. Value buying by state-run banks and continued overseas inflows of $4.3 billion under the Fully Accessible Route since June 1 limited some losses, though analysts expect inflow pace to slow.