Indian government bond yields ended little changed on Thursday ahead of Friday's weekly debt sale, while investors also took comfort from easing oil prices and U.S. peers, which fell from recent highs.

The yield on the benchmark Indian 10-year note ended at 7.1905%, after closing at 7.1860% on Tuesday. The bond market was shut on Wednesday for a holiday.

U.S. yields came off their recent highs on Wednesday, slowing a week-long selloff. The relentless rise in U.S. yields was caused by changing expectations of Federal Reserve rate cuts in 2024 following recent economic data and commentary from policymakers.

"Strong consumption demand implies that the journey towards 2% inflation target (in the U.S.) might be more protracted. Under current circumstances, a delayed start to a shallow rate cut cycle is expected," said Gaura Sen Gupta, India economist at IDFC FIRST Bank.

Futures markets now expect less than 50 basis points (bps) of U.S. rate cuts by end of this year, with the first reduction fully priced in November. This is sharply lower than the 150 bps of cuts widely expected at the start of the year, according to CME's FedWatch Tool.

Separately, New Delhi will sell bonds worth 240 billion rupees ($2.87 billion) on Friday, including a new 40-year note.

Meanwhile, oil prices eased overnight as a rise in U.S. commercial inventories and weaker Chinese economic data outweighed supply worries.

Oil prices had risen amid worries that the conflict in the Middle East could impact supply. Higher prices impact India's retail inflation as it is a major oil importer, and may make the Reserve Bank of India's (RBI) 4% target more difficult to achieve.

"The start of the RBI rate cut cycle will be delayed due to global factors – Fed policy and global commodity prices...We expect RBI rate cut cycle to start from October 2024," Sen Gupta said. ($1 = 83.5307 Indian rupees)

(Reporting by Bhakti Tambe; Editing by Sonia Cheema)