By Bhakti Tambe

MUMBAI, March 20 (Reuters) - Indian government bond

yields ended steady on Wednesday ahead of the conclusion of the

U.S. central bank meeting where the Federal Reserve is expected

to keep borrowing costs unchanged.

The benchmark 10-year yield ended at 7.0918%,

following its previous close of 7.0981%.

The Fed is scheduled to announce its monetary policy

decision after Indian market hours, against the backdrop of

recent data showing robust inflation in the world's largest

economy.

"We now see a high probability of 'no Fed cuts' in 2024 as

they struggle to get to the last mile of disinflation," Madhavi

Arora, lead economist at brokerage Emkay Global, said.

The odds of an interest rate cut in June have eased below

60% from around 70% a week earlier, according to the CME

FedWatch tool.

"That will also mean a shallower rate cut cycle. This will

soon spill over to emerging market central banks, including the

Reserve Bank of India (RBI)," Arora added.

The RBI has kept its interest rate steady at 6.5% during the

past six policy meetings and indicated it would consider rate

cuts only when retail inflation eases closer to the 4% target on

a sustainable basis.

U.S. Treasury yields have stayed elevated, reflecting

concerns over a delayed start to the rate-cutting cycle. The

10-year yield hovered around the 4.30% level.

Meanwhile, the persistent rise in oil prices is detrimental

to Indian bonds as elevated commodity prices could translate

into higher domestic retail inflation.

The benchmark Brent crude contract exceeded the $87 per

barrel mark, rising nearly 7% in the past five sessions through

Tuesday.

The RBI will also conduct state debt sale worth 240 billion

rupees on Thursday.