MUMBAI, April 24 (Reuters) - Indian government bond yields were steady in early trading on Wednesday after easing in the first two sessions of the week, as market participants awaited fresh triggers.

The benchmark 10-year yield was at 7.1699% as of 10:00 a.m. IST, following its previous close at 7.1643%.

The benchmark yield eased seven basis points in the last two days as oil prices retreated from multi-month highs, with traders not foreseeing any major impact on supply due to the Middle East conflict.

Oil prices affect domestic retail inflation as India is one of the largest importers of the commodity. A prolonged elevation in prices could make the Reserve Bank of India's 4% inflation target more difficult to achieve.

Extreme weather events along with prolonged geopolitical tensions could pose a risk to India's inflation trajectory, even as growth in the South Asian nation exhibits an uptrend, the RBI said in its latest bulletin on Tuesday.

U.S. Treasury yields dipped on Tuesday, after data showed U.S. business activity cooled in April to a four-month low. However, the 10-year yield stayed near the 4.60% mark, as the market does not expect rate cuts over the next few months.

Investors are expecting around 42 basis points (bps) of rate cuts by the Federal Reserve by the end of this year, compared to more than 150 bps expected at the start of 2024, according to the CME FedWatch Tool.

New Delhi will raise 320 billion rupees ($3.84 billion) through sale of bonds on Friday. This includes a new 10-year paper worth 200 billion rupees, which will replace the existing benchmark bond soon.

It will raise 270 billion rupees via sale of Treasury bills later in the day. ($1 = 83.3020 Indian rupees) (Reporting by Dharamraj Dhutia; Editing by Varun H K)