India bonds slip as Treasury rout offsets oil slide

What happened: Indian government bonds declined on Wednesday as a sharp rise in US Treasury yields, driven by hotter-than-expected October inflation and hawkish policymaker signals, overshadowed relief from lower crude oil prices. Key numbers: US 10-year Treasury yield rose more than 12 bps to 4.9830%. Why it matters: Higher US yields erode the premium offered by Indian bonds, reducing their appeal to foreign investors. A Fed hike could push the RBI to tighten policy, and a trader expects the 10-year yield to trade in a 7.10% to 7.25% range until the next RBI policy.

Indian government bonds declined on Wednesday as a sharp rise in US Treasury yields, driven by hotter-than-expected October inflation and hawkish policymaker signals, overshadowed relief from lower crude oil prices.

Higher US yields erode the premium offered by Indian bonds, reducing their appeal to foreign investors. A Fed hike could push the RBI to tighten policy, and a trader expects the 10-year yield to trade in a 7.10% to 7.25% range until the next RBI policy.