Indian government bonds advanced in early Thursday trading, defying a sharp rise in US Treasury yields that has pressured global fixed-income markets.
The resilience of Indian debt was driven by a combination of falling crude oil prices and sustained foreign investor demand, which together outweighed the headwinds from higher American borrowing costs.
The move underscores a growing divergence in emerging market dynamics.
While US yields climbed as investors digested a shift in Federal Reserve tone, Indian bond traders found support in the cooling energy complex.
Lower oil prices reduce import bills and inflationary pressure for India, a net energy importer, thereby improving the risk-reward profile for local currency assets.
This fundamental advantage has attracted foreign capital at the fastest pace in 15 months, according to recent data.