Indian government bonds are expected to begin Friday's session on a weaker note, with traders leaning bearish as the market prepares for fresh debt supply. The cautious tone comes at a time when buying support appears less certain, especially with slower foreign participation putting more pressure on local demand.
The benchmark 6.94% 2036 bond yield is seen moving in a 6.80% to 6.84% range, according to a trader at a private-sector bank. That follows Thursday's close at 6.8132%, leaving the market focused on whether upcoming supply pushes yields higher in early trade.
Fresh issuance often tests investor appetite, and the latest supply is arriving as domestic investors are being watched more closely for support. With overseas inflows not as strong, traders are likely to stay sensitive to demand signals and price moves across the government debt market.
For now, sentiment appears tilted toward mild weakness rather than a sharp move. The early direction in Indian government bonds will depend on how the market absorbs the new supply and whether buyers step in to steady yields near the expected range.
