• On Thursday, the 10Y benchmark (6.94% GS 2036) opened 1 bp higher at 6.97%, tracking the rise in crude to around $101/bbl and the hardening in 10Y UST yields to 4.85%. • Brent crude continued to trade above $100 and touched $102 intraday, amid retaliatory US-Iran strikes on commercial vessels near the Strait of Hormuz, disrupting regional oil supplies and raising inflation concerns. • The 10Y UST yield hardened to 4.85% amid persistent inflation concerns and ahead of Friday’s inflation data. • The 10Y IGB traded in the range of 6.96%-6.97% before touching 6.98% intraday amid heightened geopolitical uncertainty. The 10Y point closed the day 2 bps higher at 6.98% vs 6.96%. • Banking system liquidity remained in surplus at ~INR 10.49 Tn. RBI conducted overnight VRRR auction for INR 6 Tn to absorb excess liquidity, accepting INR 3.9 Tn at 5.24%.
