By Dharamraj Dhutia
MUMBAI, April 20 (Reuters) - Indian government bond
yields were largely unchanged on Thursday, as traders awaited
fresh cues from the minutes of the Reserve Bank of India's
latest policy meeting, due later in the day.
The 10-year benchmark 7.26% 2032 bond yield was at 7.2236% as of 10:00 a.m. IST, after closing at 7.2251% in
the previous session.
Commentary from the central bank officials would provide
crucial insight into the RBI's thinking and could guide the
markets, a trader with a primary dealership said.
The minutes from the Monetary Policy Committee meeting will
come after market hours and will provide clarity on the central
bank's stance on interest rates.
The RBI had surprised markets earlier this month by holding
its key policy rate at 6.50%, against wide expectations of a 25
basis point hike.
India's retail inflation falling to 5.66% in March, below
the central bank's upper tolerance level of 6%, has cemented
bets of a prolonged pause.
Nomura expects retail inflation to drop to a 4.5% to 4.7%
range in April, its lowest in 18 months, after staying above the
RBI's upper threshold for most of the previous financial year.
Market participants will also keep an eye on moves by
state-run banks, as they are likely to wait for government bond
prices to drop before rebuilding positions after offloading
notes over the past month to book profits.
State-run banks have net sold bonds worth over 460 billion
rupees ($5.60 billion) in last 25 trading sessions, data from
Clearing Corporation of India showed.
Meanwhile, the 10-year U.S. yield continues to hover around
3.60% as odds of a rate hike by the U.S. Federal Reserve on May
3 have risen to around 90%. The current target range is
4.75%-5.00%, up from near zero in March 2022. ($1 = 82.1750 Indian rupees)
(Reporting by Dharamraj Dhutia; Editing by Varun H K)
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