Indian government bonds rallied on Friday, with the benchmark 10-year yield posting its sharpest decline in more than a week.
The move was driven by a combination of softer oil prices, robust foreign inflows, and strong demand at a weekly auction, which collectively lifted sentiment across the fixed-income market.
The yield drop reflects a broader repricing of geopolitical risk premiums following the fragile ceasefire between the United States and Iran.
As crude prices softened, the immediate pressure on India’s import bill eased, providing a tailwind for both the bond market and the currency.
The Indian rupee had already strengthened to 94.32 per dollar last week, marking its best weekly performance in 11 weeks, supported by the same mix of falling crude and a weaker US dollar.
This development extends the rally in Indian government bonds, which have now advanced for five consecutive sessions.