India bonds-Oil pain pins India bonds in range; RBI minutes to give next cue

India's overnight indexed swap rates traded mixed, searching for fresh cues.

The one-year INR1YMIBROIS=CC swap fell 1.75 bps to 5.8075%, and the two-year INR2YMIBROIS=CC was little changed at 6.0475%. The liquid five-year INR5YMIBROIS=CC rate gave up 2.25 bps to 6.3975%.

The rupee slid to a late-July low of 95.7525 per dollar, while the benchmark Nifty 50 extended its losing run to seven sessions, its longest in 11 months. INR/ .BO

"Follow the oil," said Alok Singh, head of treasury at CSB Bank in Mumbai, noting that crude prices remained the biggest drag on bonds even as surplus liquidity, improving monsoon conditions and contained inflation support demand.

The Reserve Bank of India's early closure of its discounted swap window for hedging diaspora deposits has returned global cues, chiefly oil and U.S. Treasury yields, to the forefront, traders said.

The RBI and Federal Reserve policy minutes are due later in the day and will be closely watched for further market direction.

Indian government bonds stayed pinned in a narrow range on Wednesday, as higher oil prices blunted support from softer U.S. Treasury yields, with traders awaiting the U.S. and local central banks' latest policy minutes for direction.

Global bond yields steadied on Wednesday, holding near multi-decade highs hit in the previous session as swelling government debt and geopolitical risks kept pressure on markets.

The 10-year U.S. Treasury yield fell about 1.5 basis points to 4.69% in Asian trade, offering some relief to domestic debt, but rising crude offset that in the second half.