India's 10-year benchmark bond rallied early on Monday taking comfort from the central bank's unexpected announcement last week about purchase of sovereign bonds via open market operation.

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The 10-year benchmark bond yield opened at 7.60 percent, sharply lower from its Friday close of 7.73 percent. However, traders expect some pullback in the rally as the amount of bonds to be bought by the Reserve Bank of India is too little and too late, they said.

Soon after a disappointing sale of government bonds on Friday, the RBI said it will buy 100 billion rupees ($1.50 billion) of government bonds on May 17.