Thank you for the link @malecjan. I was unaware of OS level differences between the left and right Alt buttons.
Since I am located in India, the English (India) keyboard layout was activated by default, which maps the right Alt to AltGr (http://kbdlayout.info/KBDINEN/). When I switched to the English (United States) layout, the right alt worked as expected.
@malecjan, I would prefer the Alt+<-/-> keys too. I’m a new user who isn’t familiar enough with the keyboard shortcuts and decided to use the default ones till I have a grasp on working with Obsidian. I will be changing them to Alt+<-/-> too. Thank you for the suggestion.