Mumbai,  The yield on 10-year benchmark 6.54 per cent-2032 bond fell more than 10 basis points on Wednesday as easing oil prices and lower than estimated CPI inflation print improved sentiments of traders, dealers said.

At 1.42 p.m., yield on 6.54 per cent -2032 bond were trading at 7.1696 per cent, sharply down from its previous close on 7.2894 per cent on Friday.

Indian financial markets were closed on Monday and Tuesday on account of Independence Day and Parsi New year, respectively.

"Easing crude oil prices and inflation print resulted in falling yields on bonds today," a dealer with a state-owned bank said.

Brent crude oil prices, which were trading at $98 a barrel, on Friday have eased to $92.04 per barrel.

Crude oil prices in the international market have fallen due to disappointing China's economic data that forced China's central bank to hike lending rates. The prices on crude continued its fall on Tuesday too, but by afternoon trade it rose.

Meanwhile, India's retail inflation, which is measured by the Consumer Price Index (CPI), eased to a 5-month low 6.71 per cent in the month of July, down from 7.01 per cent in June.

Despite easing in July, it remained above the central bank's upper tolerance band of 6 per cent for the seventh consecutive month.

Dealers expect bond yields to close nearly 14-15 basis points from its previous close on Wednesday.