Indian government bonds ​edged lower on Tuesday, tracking a ​global debt selloff, although bargain buying limited the losses.The benchmark 6.94% 2036 bond yield settled at 6.9581% after a volatile session, compared to 6.9452% on Monday.It rose to 6.9653% earlier in the day, its highest intraday level ‌since June ⁠11, before ⁠recovering slightly as local banks, led by state-run lenders, likely stepped in to ​buy on dips, according to traders.The U.S. 10-year Treasury yield climbed to 4.7860%, its highest since January 2025, as renewed U.S.-Iran attacks lifted oil prices and revived inflation concerns. Brent futures hovered at around $92 a barrel in Asian trade.Higher oil prices have stoked inflation concerns ⁠and fiscal risks ‌for India, the world's third-largest oil importer and consumer.Traders ​consequently ramped ​up bets on rate hikes by the Reserve Bank ⁠of India, pushing borrowing costs higher. India's overnight index swaps ​are now pricing in at least three hikes over ​the next 12 months, traders said.India's economy expanded 7.8% year-on-year in April-June, above the 7.1% Reuters poll forecast, strengthening the case for tightening."It all depends on oil moves now. Rate expectations will increase or decrease accordingly," said Alok Singh, head of treasury at CSB Bank ‌in Mumbai.Foreign investors also turned marginal sellers of Indian bonds last month, posting their first monthly outflow of the financial ​year. They ​offloaded 8.5 billion ⁠rupees ($89.54 million) of securities under the Fully Accessible Route in August, CCIL data showed.Ample banking system liquidity, however, supported demand, with the surplus swelling to 6.65 ​trillion rupees on Monday, its highest since April 2022.RATESIndia's OIS rates edged higher on Tuesday.The one-year swap rate was up 1.5 bps at 6.0150%, and the two-year swap rose 1.75 bps to 6.21%. The five-year rate ended 2 bps higher at 6.5050%.