Indian government bonds inch down in early trades on Monday as a rebound in crude oil prices hurts sentiment on persistent doubts over the durability of a truce between the United States and Iran.
The yield on India's benchmark 6.48% 2035 bond was at 6.9101% as of 10:15 a.m. IST, after closing at 6.9049% on Friday. Bond yields move inversely to prices.
"The market is in wait-and-watch mode, with traders reluctant to take aggressive positions amid uncertainty over movement in oil prices, and any major action likely only after what happens at the end of ceasefire deadline," trader with a private bank said.
Oil prices rebounded on Monday, a day before the two-week truce between the warring nations ends, after the Strait of Hormuz was shut again as both Iran and the U.S. accuse each other of violating their ceasefire by attacking ships over the weekend.
The U.S. military intercepted and seized an Iranian cargo vessel that it said was attempting to break through its blockade, according to comments made by U.S. President Donald Trump on Sunday.
At the same time, Iran said it is refusing to join a second round of peace negotiations, even as Trump warns that Washington could launch fresh air strikes if tensions continue to escalate.
The conflict has emerged as the most severe disruption to global energy supplies on record, with the Strait of Hormuz, the strategic waterway which handles roughly one-fifth of global oil shipments, remaining largely shut for most of the war.
Brent crude traded around $95 per barrel and for energy import-dependent India, the rise in oil prices is particularly damaging.
The sustained increase in crude prices since the war began on February 28 has pushed bond yields higher along with inflation worries.
RATES
India's overnight index swap rates were marginally higher, tracking bond yields, but volume remained shallow.
The one-year OIS rate had not yet traded, while the two-year swap rate was at 6.00%. The liquid five-year rate was at 6.2850%.
Published on April 20, 2026