By Dharamraj Dhutia

MUMBAI, June 4 (Reuters) - Indian government bond prices were little changed early Wednesday, with some signs of falling yields as traders awaited the central bank's policy decision later this week.

The yield on the benchmark 10-year bond IN063335G=CC was at 6.2008% as of 10:00 a.m. IST, compared with the previous close of 6.2022%. The five-year 6.75% 2029 bond yield IN067529G=CC was at 5.8366% after ending at 5.8440%.

"There are some voices stating there could be more than just a token 25 basis point rate cut, and we will not be surprised if there a large rally in prices over the next couple of days," the trader said.

The Reserve Bank of India's policy decision is due on Friday, where it is widely expected to cut interest rates by 25 basis points for a third consecutive time.

The central bank has lowered policy rates by 50 basis points in 2025 and has infused $100 billion into the banking system in December-May period.

While most expect a 25 bps cut, the State Bank of India said the RBI should slash rates by 50 bps to jumpstart the credit cycle.

Meanwhile, foreign investors continued to offload bonds, with net sale of 270 billion rupees ($3.15 billion) from bonds that are included in global indexes, since April 1.

Still, David Hauner, head of global emerging markets fixed income strategy at BofA Securities expects Indian bonds to be among the top three in Asia, to attract inflows once tariff-related uncertainties ease.

RATES

Overnight index swap $(OIS)$ rates are expected to stay range-bound, with shallow volumes through Thursday.

The one-year INR1YMIBROIS=CC OIS rate and the two-year OIS rate were not yet traded after ending at 5.55% and 5.43%. The most liquid five-year INR5YMIBROIS=CC was marginally lower at 5.63%

($1 = 85.8270 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Nivedita Bhattacharjee)

((Dharamraj.dhutia@tr.com))