MUMBAI: Indian government bond yields are likely to be little changed in the early session on Thursday amid a lack of fresh cues, while market participants will continue to track the moves in oil prices and US yields.

The 10-year benchmark bond yield is expected to be between 7.23%-7.27% after ending the previous session at 7.2444%, a trader with a foreign bank said. “Bond yields fell in the last hour of Wednesday’s session as US yields and oil prices were down.

Today, the benchmark yield will open near flat and likely be rangebound during the day,“ the trader said.

Oil prices fell on Thursday, extending losses from the previous session, after OPEC+ postponed a ministerial meeting stoking views the producers might cut output less than earlier anticipated.

Easing oil prices is good for countries like India, which are major importers of the commodity. India’s annual retail inflation eased in October to 4.87%, edging closer to the central bank’s 4% target.

Meanwhile, US Treasury yields pared early losses on Wednesday after strong initial jobless claims data unsettled a market that expects the Federal Reserve to start cutting interest rates around June next year. US markets are shut on Thursday for the Thanksgiving holiday.

Traders are also awaiting a decision on the inclusion of Indian bonds in the Bloomberg Global Aggregate and the Emerging Market Local Currency indexes after JPMorgan added the notes to its emerging market index in September. “Bond prices have not rallied on expectations of the inclusion in the Bloomberg index.

India bond yields fall as US peers decline

So, if that doesn’t happen, it will not have much impact on the market or broader sentiment,“ said Dwijendra Srivastava, chief investment officer - debt at Sundaram Mutual Fund.