MUMBAI: Indian government bond yields fell on Wednesday tracking US Treasury yields, while investors refrained from placing large bets in the absence of fresh triggers.

The 10-year benchmark bond yield was at 7.2590% as of 10:00 a.m. IST, after ending the previous session at 7.2706%.

“The benchmark yield was lower following overnight movement in US yields but is likely to remain rangebound during the day because UST (US Treasuries) and oil prices are steady in early Asian trading,” a trader with a foreign bank said.

US bond yields fell on Tuesday after a poorly received auction of 10-year inflation-protected notes.

The 10-year US yield was at 4.3985% in Asian hours.

Moreover, minutes from the Federal Reserve’s latest meeting showed officials agreed to take a cautious approach to raising interest rates going forward.

US policymakers also said they would only need to hike rates if incoming information showed a lack of progress in lowering inflation, according to minutes from the Oct. 31-Nov. 1 meeting.

US bond yields have been easing on expectations that the Fed is done with its rate hikes.

India bond yields ease tracking US peers; state debt sale eyed

Investors are pricing in a rate cut at the May or June meeting. Meanwhile, oil prices were steady after rallying for two sessions, with investors cautious ahead of Sunday’s scheduled OPEC+ meeting, where the grouping may discuss deepening supply cuts.

The benchmark crude contract was at $82.34 per barrel.

Domestic bond traders await a decision on the inclusion of Indian bonds in the Bloomberg Global Aggregate and the Emerging Market Local Currency indexes after JPMorgan added the bonds to its emerging market index in September.

Indian government bonds could see foreign inflows of close to $25 billion if they are included in key Bloomberg bond indexes, said Sameer Karyatt, executive director - treasury and markets at DBS Bank India.