MUMBAI: Indian government bond yields rose on Thursday, with the benchmark bond yield crossing 7.20%, triggered by a relentless rise in oil prices and Treasury yields.

The 10-year benchmark 7.18% 2033 bond yield was at 7.2098% as of 10:00 a.m. IST, after ending at 7.1704% in the previous session.

Indian money markets will be open on Thursday and Friday, according to a Reserve Bank of India circular.

They were earlier scheduled to be closed on one of those days for a regional holiday.

“Market is now under the grip of bears, and to top it all, we are not really sure whether both oil and 10-year US yield is at top levels or there is more room for rising further,” a trader with a primary dealership said.

Fresh supply of debt at the end of the quarter further challenged bullish sentiment.

New Delhi aims to raise 390 billion rupees ($4.69 billion) through the sale of bonds later in the day, the last debt auction for the fiscal first half.

India maintained its plan to borrow 6.55 trillion rupees through bond issues in the October-March period, while it will borrow a maximum of 1.45 trillion rupees through 10-year bonds, which is 22% of the overall borrowing.

India bond yields rise, as spike in Treasury yields hurts appetite

The 10-year US yield hit a 16-year peak, boosted by expectations that the Federal Reserve will keep interest rates higher for longer to lower inflation to its 2% target.

The benchmark Brent crude contract rose above $97.50 per barrel, its highest level in nearly a year, as a steep drop in crude stocks in the United States added to worries about tight global supplies.

These factors dented investors’ appetite, offsetting a bullishness from JPMorgan’s inclusion of India in its emerging market debt index.

The FTSE Russell, which has India on its watchlist for inclusion in the FTSE Emerging Markets Government Bond Index, will announce a decision on Thursday.