Indian government bonds advanced on Thursday, with the benchmark 6.94% 2036 bond yield closing at 6.7478%, down 2.5 basis points from the previous session.
The move marks a continuation of resilience in Indian debt markets, which have been holding firm despite a sharp rise in US Treasury yields that has weighed on global fixed-income assets.
The rally was underpinned by steady oil prices, which helped alleviate macroeconomic concerns regarding import costs and inflationary pressure in the world's fourth-largest economy.
Simultaneously, fading bets on imminent US rate hikes provided additional support, reducing the pressure on emerging-market currencies and bond yields.
This dual dynamic allowed Indian bonds to recover ground, reversing earlier losses seen in previous sessions.
This development underscores the decoupling of Indian fixed-income markets from broader global trends, driven by domestic fundamentals and specific commodity dynamics.