By Dharamraj Dhutia and Khushi Malhotra

MUMBAI, Feb 27 (Reuters) - India's five-year INR5YT=RR and 10-year bond yields IN10YT=RR are set to plunge 25 basis points over the next few weeks as the central bank should cut interest rates once again, a treasury executive at Bank of America said on Thursday.

The Reserve Bank of India cut the policy repo rate in February, its first cut in nearly five years, citing slowing growth.

Given the growth-inflation dynamics, there is room to cut rates even after April, Vikas Jain, head of India fixed income, currencies and commodities at Bank of America.

"We are expecting the 10-year bond yield to move to 6.45% by April, as we expect a 25 basis point cut in April, with expectation for one more cut in the next two policies."

The next monetary policy decision is due on April 9.

India's 10-year benchmark bond yield IN067934G=CC was at 6.70% on Thursday and the five-year yield IN067529G=CC at 6.61%.

The premium of the 10-year India bond yield over the policy repo rate should not be more than 45-50 basis points, Jain said, adding the bank likes the "front-end of the yield curve".

"We generally like bonds of up to five years."

If India's growth slows to around 6% in October-December, the central bank will start focusing on growth, the banker said.

The GDP data is due on Friday.

Jain says the RBI will need to push durable banking system liquidity into surplus of at least 1 trillion rupees to 1.5 trillion rupees if it wants to "go aggressive on growth".

The central bank has injected hefty amounts of liquidity, pumping in more than 3.6 trillion rupees ($41.3 billion) into the banking system through a combination of debt purchases, FX swaps and longer-term repos, with another $10 billion swap due on Friday.

Jain expects the Indian rupee INR=IN to remain under depreciation pressure, with U.S. dollar strength persisting for some more time.

"We expect the currency to depreciate to 88.50-89.50 per dollar level by end of 2025."

The rupee was at 87.23 on Thursday.

($1 = 87.1790 Indian rupees)

(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Mrigank Dhaniwala)

((Dharamraj.Dhutia@thomsonreuters.com;))