U.S. Treasury yields have dropped sharply, causing the yield gap with Indian government bonds to widen to a level not seen in four months. The yield on the 10-year U.S. Treasury note fell more than 20 basis points over the past week to 4.03%. During the same period, the yield on India's 6.48% bond maturing in 2035 declined by approximately 6 basis points to 6.6642%. The spread between the two widened to 263 basis points, the highest since October 18, marking a significant increase from the 238 basis points seen a month ago. A trader from a primary dealer noted, "U.S. yields are poised to fall below 4%, and the spread still has room to widen further. However, India’s 10-year bond yield will face strong selling pressure in the 6.62%–6.63% range." Weaker-than-expected U.S. inflation data has heightened expectations for Federal Reserve interest rate cuts, driving down U.S. bond yields, while the Indian bond market continues to face supply pressures.