Bond yields on Monday tracked a slide in their US peers and the rupee inched higher amid a modest rise in other Asian currencies, although the gains were capped by losses in the domestic share market.
The benchmark 10-year bond yield was at 7.37% in the early hours, compared with its close of 7.41 per cent on Friday.
The US 10-year Treasury note yield ended the week near its lowest since late-May after weak data on Friday added to worries about the global economy and traders reassessed the Federal Reserve's ability to raise rates much further.
The dollar, however, was on a firm footing as traders braced for a sharp US interest rate hike this week and looked for safety as data points to a weakening global economy.
The partially convertible rupee was trading at 79.83/84 per dollar, compared to its close of 79.8550 aided by gains in its emerging market peers.
Traders said concerns of the Reserve Bank of India (RBI) stepping in to sell dollars to prevent a slide in the rupee was also keeping falls in check but if stock markets continue to fall during the day, demand for dollars may rise.
The benchmark and the broader NSE share index were both trading down 0.7 per cent each, snapping a six-day rally, dragged down by Reliance Industries after a weaker-than-expected earnings report.