Indian bonds seen opening flat with focus on oil moves, Fed decision

Indian government bonds were expected to start Tuesday with little change, Business Recorder reported, as oil and US Treasury markets were steady ahead of the Federal Reserve’s decision due Wednesday. A trader expected the 6.94% 2036 bond yield to move within 7.46% to 7.49%, after it ended the previous session at 7.4826%.

Indian states planned to raise 233 billion rupees ($2.45 billion) through bond sales on Tuesday, an amount the trader said was unlikely to disrupt trading. Brent crude was below $115 per barrel in Asian trading, after a 6.2% increase last week, its biggest weekly gain since the week ended September 11.

The report said India imports nearly 90% of its oil, leaving inflation, the rupee and public finances exposed to persistently high energy costs. Markets are also weighing the Reserve Bank of India’s recent rate increase and expectations of more than 100 bps of hikes over the next 12 months, while looking to the Fed for clues beyond an anticipated pause.