MUMBAI: Indian government bond yields were higher in early trades on Thursday, as some traders booked profits after a sharp rally in prices, while they await auction of a new 10-year bond.

The benchmark 10-year government bond yield was at 7.1978%, as of 0335 GMT, after closing at 7.1825% on Wednesday. The yield had dropped 11 basis points in the previous session to post its largest single session drop in two months.

New Delhi is scheduled to auction bonds worth 330 billion rupees ($4.15 billion) on Friday, which includes 130 billion rupees of a new 10-year bond that will replace the existing benchmark note in coming weeks. ($1 = 79.5730 Indian rupees) (Reporting by Dharamraj Lalit Dhutia)