Indian government bond yields are expected to climb on Wednesday, with the benchmark bond yield set to test levels seen before the budget announcement, as Treasury yields jumped after an uptick in inflation further pushed back rate cut hopes.

India’s benchmark 10-year yield is expected to fluctuate in the 7.10-7.16% range, following its previous close of 7.0998%. “This is exactly what traders were fearing, and with the 10-year U.S. yield hitting the 4.30% mark, there should be a gap-up opening for Indian bond yields, as the global scenario can definitely be not ignored despite favourable local fundamentals,” the trader said.

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