Indian bond yields track U.S. peers higher, up after 9-session slide

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FILE PHOTO: Illustration photo of an India Rupee note

MUMBAI (Reuters) - Indian government bond yields rose on Wednesday after a nine-session slide, tracking a spike in U.S. Treasury yields, with market participants now awaiting the Reserve Bank of India's monetary policy decision on Friday.

India's 10-year benchmark bond yield was at 7.2294%, as of 0420 GMT, after rising to 7.2526% in early trade. The yield had dropped 25 basis points in the last nine sessions, closing at 7.1962% on Tuesday.

"Local bonds are reacting to their U.S. counterparts, but still we do not see the benchmark yield crossing 7.25% till Friday's policy decision and commentary," a trader with a state-run bank said.

On Tuesday, two U.S. Federal Reserve officials signalled that the central bank remained committed to hiking interest rates to a level that would further curb economic activity, pushing U.S. 10-year yields 14 bps higher. [US/]

The RBI monetary policy committee's decision is due on Friday, with views on the quantum of rate increase widely split between 25 basis points and 50 basis points, according to a Reuters poll of economists.

Barclays expects the RBI to hike its repo rate by 35 bps on Friday to 5.25%, which could be followed up by two more hikes of 25 bps each in September and December. The RBI has raised rates by 90 basis points since May.

(Reporting by Dharamraj Lalit Dhutia; Editing by Subhranshu Sahu)

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