10-year yield sees steepest one-day jump since Oct 2023

Yield on the 10-year benchmark government bond jumped 10 basis points to close at 6.83%, CCIL data showed. One basis point is a hundredth of a percentage point.

The 10-year yield opened at 6.78% and inched up to 6.88% in the first hour of the session as global markets traded with nervousness ahead of the expiry of Donald Trump’s 48-hour deadline to Tehran to reopen the Strait of Hormuz.

Yields saw their biggest single-day spike since October 2023 and ended at highest level since January 2025, LSEG data showed. They, however, eased after the US president indicated no immediate attacks on Iran following diplomatic efforts. The 10-year yield eased from 6.88% to 6.79% in the last half hour of the trade, before closing at 6.83%.
“When the news of US-Iran talks came, some short covering and profit booking happened. But sentiments are negative. RBI is mildly present and on the sidelines since global yields are also inching up,” said a bond trader at a primary dealership.

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Yields across either side of the Atlantic have hardened, with Reuters reporting that the probability of further rate easing by the US Federal Reserve may have reduced amid the most visible spike in risk-free rates in the US since last summer.
Meanwhile, Goldman Sachs Sunday raised its oil price forecasts for the second time in as many weeks, global media outlets reported, citing Wall Street bank’s concerns over the Strait of Hormuz. It now expects Brent to average $110 in March-April, up from a prior forecast of $98 and marking a sharp increase from 2025 levels. ‘Higher for Longer’
The upgrade extends beyond the immediate disruption. Goldman raised its 2026 Brent forecast to $85 from $77, with WTI seen at $79, while longer-dated prices have also been revised higher.

Back home, banking system liquidity, too, was in a deficit for the first time in nearly three months after quarterly advance tax outflows and due to increased central bank intervention in the foreign exchange market, traders said. Experts, however, expect system liquidity to improve in the next few days.

System liquidity stood at a deficit of ₹65,395.64 crore as of March 22 against a daily average surplus of ₹2.45 lakh crore since February. Consequently, this also raised overnight borrowing costs for banks, with call rate trading at an average of 5.32% on Monday, versus a weighted average call rate of 5% from February.

“We do have about ₹5 lakh crore of durable liquidity, hence showing that there is money with the government. I expect this money to flow into the banking system in the coming week as government and end-of-year spending,” said Alok Singh, head of treasury at CSB Bank.