Indian government bonds ended the session little changed, stabilizing after tracking sharp swings in crude oil prices.
The benchmark 6.94% 2036 bond yield settled at 6.7770%, down from an intraday high of 6.8315%, as oil retreated from its daily peak.
This marks a pause in the four-week rally that had been driven by rising oil prices and geopolitical uncertainty.
The cross-asset correlation between energy and fixed income remains tight.
As crude prices softened, pressure on Indian bond yields eased, reflecting the market's sensitivity to import costs and inflation expectations.
The yield dip suggests that traders are recalibrating risk amid the ongoing Strait of Hormuz tensions, which have previously fueled shipping risk and geopolitical pressure on trade routes.
Market participants continue to grapple with renewed geopolitical uncertainty.
While the immediate selling pressure on bonds has abated, the underlying supply disruption risks persist.