Indian Bonds Slump Amid Fed Hike Bets and Soaring Oil Prices

Indian government bonds saw a sell-off on August 31, 2026, as yields climbed following hawkish comments from the U.S. Federal Reserve and a sharp rise in crude oil prices.

The combination of potential global rate hikes and higher energy costs triggered investor caution, signaling concerns over inflation and the domestic interest rate outlook.

Investors moved away from government securities, causing yields on the benchmark 6.94% 2036 bond to climb to 6.9538%, the highest level seen since June.