MUMBAI, Sept 16 (Reuters) - Indian government bond

yields remained rangebound on Tuesday before the U.S. Federal

Reserve's much awaited policy decision.

The yield on the 10-year benchmark note ended

at 6.4925%. It closed at 6.4963% on Monday.

The Fed's policy announcement is due after market hours on

Wednesday and the central bank is expected to resume its rate

easing cycle after a nine-month hiatus.

The market has already factored in a 25-basis-point rate

cut, with a thin possibility of a 50-bps move.

"If Fed cuts rate by 25 basis points, which is already priced

in, it may not impact the market much," said Gopal Tripathi,

head of treasury and capital markets at Jana Small Finance Bank.

"The market will continue to move sideways and wait for the

second-half borrowing calendar for more cues."

The 10-year yield may test 6.40% if the cut is larger than

expected, traders said.

Investors are awaiting New Delhi's upcoming borrowing plan,

expected this month, to see if the central bank adjusts the mix

to reduce long-bond supply.

The Reserve Bank of India met bond market participants

earlier this month for their suggestions on the borrowing mix.

Indian lenders and traders have urged the central bank to

cut the share of ultra-long federal bonds in the supply schedule

and reduce weekly auction sizes, which could stretch the

borrowing calendar until next March.

RATES

India's overnight index swaps inched lower on Tuesday, with

traders awaiting the Fed policy decision.

The one-year OIS rate was little changed

at 5.4675% and the two-year OIS rate was down

nearly 2 bps at 5.44%. The liquid five-year OIS rate

slipped 1 bp to 5.7025%.