Indian government bonds are expected to open firmer on Tuesday, supported by data revealing higher-than-expected inflows from foreign investors.
The benchmark 6.94% 2036 bond yield is projected to trade in a narrow 6.76%-6.79% range, reflecting sustained demand for Indian sovereign debt despite broader market volatility.
The positive flow data comes as a counterweight to rising geopolitical anxiety.
Concerns over potential military escalation in the Middle East, particularly regarding shipping routes in the Strait of Hormuz, continue to weigh on global risk sentiment.
While foreign capital has been a stabilizing force for Indian fixed income, traders are wary that any sudden spike in oil prices or direct conflict could overshadow the supportive flow dynamics.
This development follows a period of significant foreign investment in Indian bonds.