Indian government bond prices advanced on June 15, driving benchmark yields lower as markets reacted positively to a ceasefire agreement between the United States and Iran. The development is expected to facilitate the reopening of the Strait of Hormuz, a critical global oil shipping route, reducing fears of prolonged supply disruptions in the energy market.

The yield on the benchmark 10-year government bond fell approximately seven basis points to 6.8527 percent during early trading. Bond prices and yields move inversely, meaning the decline in yields reflected increased demand for government securities. Lower crude oil prices typically support Indian bonds by easing inflation risks and reducing pressure on the country's import bill.

Following news of the ceasefire, Brent crude oil prices dropped to around $83 per barrel, marking a significant decline from recent highs. The easing in oil prices has improved the outlook for inflation, the current account balance, and the Indian rupee, all of which are supportive for the domestic fixed-income market.

Market participants also expect improved foreign investor interest in Indian debt, aided by recent regulatory measures aimed at enhancing participation in the bond market. Analysts noted that sustained stability in crude oil prices could further support bond prices and help keep borrowing costs contained.

Investors are now closely monitoring global central bank actions, particularly the upcoming US Federal Reserve policy decision, for further cues on interest rates and capital flows.