MUMBAI: Indian government bonds slipped on Friday, closing the week lower, after tepid demand at a debt auction earlier in the day prompted a secondary-market rout. The benchmark 10-year yield ended at 6.6017% after closing at 6.5738% on Thursday. For the week, the 10-year yield rose 1 basis point after jumping 10 bps last week. Bond yields rise when prices fall. New Delhi sold 180 billion rupees ($2 billion) of five-year 6.01% 2030 bond at a cutoff price which was sharply lower than market estimates which were already conservative. “As the year-end approaches, overall risk sentiment in the market has decreased, causing a larger spike in yields despite improved carry on the curve,” Sameer Karyatt, executive director and head of trading, DBS Bank India. Earlier this month, the Reserve Bank of India cut its policy repo rate by 25 bps, taking the total quantum of cuts in 2025 to 125 bps. It also announced liquidity infusion through debt purchases and a foreign exchange swap. The minutes of that meeting are due after Indian market hours. Bonds have sold off in the following two weeks, with the 10-year bond yield touching as high as 6.63%, as traders fear RBI’s rate cutting cycle may be ending and heavy bond supply looms. “The market anticipates that we are nearing the end of the easing cycle, and this expectation is already being priced into the OIS curve. The probability of further rate cuts has clearly diminished,” DBS’ Karyatt added. The RBI bought bonds worth 1 trillion rupees and has infused around 450 billion rupees through FX swap since the policy. RATES India’s overnight index swap rates ended marginally higher tracking bonds yields. The one-year OIS rate ended at 5.47%, while the two-year swap rate closed at 5.5650%. The five-year OIS rate settled at 5.9450%.