MUMBAI: Indian government bond yields were little changed early on Wednesday as traders await fresh triggers, while US Treasury yields stabilise.

The 10-year bond yield was at 6.7380% as of 10:05 a.m. IST, compared with its previous close of 6.7373%.

“For the time being, it seems that fears with regards to tariffs have subsided, but any such announcement will continue to be under investors’ radar,” a trader with a state-run bank said.

Treasury yields were largely unchanged in Asia hours after easing the previous day as President Donald Trump refrained from imposing major tariffs on his first day in office, although he said Canadian and Mexican imports might attract 25% tariffs from Feb. 1.

The 10-year US yield was around 4.60% levels in early Asian trading hours, while the two-year yield was around 4.28%, with the gap between the two at its lowest since the end of December.

The market is glued to Trump’s policies on tariffs and will be volatile since any move on that front might add to inflation, which further reduces the possibility of the Federal Reserve lowering interest rates this year.

India bond yields rise in lead up to domestic inflation data

US rate futures have now priced in 38 basis points of rate cuts in 2025, starting with a 25 bps cut in June.

Domestically, the focus will also be on the Reserve Bank of India’s manoeuvres to manage banking system liquidity and the federal budget that is due next week.

The move in the benchmark bond yield is also capped as New Delhi aims to auction bonds worth 320 billion rupees ($3.70 billion), including 220 billion rupees of the benchmark note, on Friday.