<p>Mumbai: Government bond yields rose on Friday after escalating US-Iran tensions drove oil to a more than six-month high, weighing on risk appetite and keeping traders cautious ahead of the weekly debt auction.</p><p>The benchmark 6.48 per cent 2035 bond yield was at 6.7167 per cent at 10:10 am IST, compared with 6.6780 per cent at Wednesday’s close. Bond yields move inversely to prices.</p><p>The debt market was shut on Thursday for a local holiday.</p><p>Sentiment was already fragile on supply concerns, and the surge in crude added pressure, traders said. President Donald Trump issued fresh warnings on Thursday urging Iran to strike a deal on its nuclear programme, prompting Tehran to threaten retaliation against US bases in the region if attacked.</p>.Reliance Industries to invest Rs 10 lakh crore in AI push: Mukesh Ambani.<p>Traders said a large US military build-up in the Middle East has heightened fears of a wider conflict, keeping markets on edge. Benchmark Brent Crude futures rose to $71.94 a barrel on Friday, their highest since July 31, 2025. Higher oil prices are a negative for India, one of the world's largest crude importers.</p><p>"Paying in overnight index swaps (OIS) on rising oil prices has lifted risk aversion, and traders may avoid adding duration as tensions could escalate over the weekend," said a trader at a private bank, adding that investors would be wary of taking risk at the weekly auction.</p><p>New Delhi is set to raise 330 billion rupees ($3.62 billion) through the sale of government bonds later in the day.</p><p><strong>Rates</strong></p><p>Long-term OIS rates rose on a risk-off move driven by higher crude.</p><p>The one-year OIS rate rose 2 bps to 5.52 per cent, while the two-year rate rose about 3 bps to 5.6475 per cent. The five-year OIS rate jumped nearly 5 bps to 6.0875 per cent.</p><p><em>($1 = 91.0410 Indian rupees)</em></p>
<p>Mumbai: Government bond yields rose on Friday after escalating US-Iran tensions drove oil to a more than six-month high, weighing on risk appetite and keeping traders cautious ahead of the weekly debt auction.</p><p>The benchmark 6.48 per cent 2035 bond yield was at 6.7167 per cent at 10:10 am IST, compared with 6.6780 per cent at Wednesday’s close. Bond yields move inversely to prices.</p><p>The debt market was shut on Thursday for a local holiday.</p><p>Sentiment was already fragile on supply concerns, and the surge in crude added pressure, traders said. President Donald Trump issued fresh warnings on Thursday urging Iran to strike a deal on its nuclear programme, prompting Tehran to threaten retaliation against US bases in the region if attacked.</p>.Reliance Industries to invest Rs 10 lakh crore in AI push: Mukesh Ambani.<p>Traders said a large US military build-up in the Middle East has heightened fears of a wider conflict, keeping markets on edge. Benchmark Brent Crude futures rose to $71.94 a barrel on Friday, their highest since July 31, 2025. Higher oil prices are a negative for India, one of the world's largest crude importers.</p><p>"Paying in overnight index swaps (OIS) on rising oil prices has lifted risk aversion, and traders may avoid adding duration as tensions could escalate over the weekend," said a trader at a private bank, adding that investors would be wary of taking risk at the weekly auction.</p><p>New Delhi is set to raise 330 billion rupees ($3.62 billion) through the sale of government bonds later in the day.</p><p><strong>Rates</strong></p><p>Long-term OIS rates rose on a risk-off move driven by higher crude.</p><p>The one-year OIS rate rose 2 bps to 5.52 per cent, while the two-year rate rose about 3 bps to 5.6475 per cent. The five-year OIS rate jumped nearly 5 bps to 6.0875 per cent.</p><p><em>($1 = 91.0410 Indian rupees)</em></p>