Despite hardening of the yield in the 10-year benchmark government securities (G-Secs) after the Budget, it is likely to ease on expectation of a possible policy rate cut by the Reserve Bank due to lower inflation and steeply falling growth, say analysts.

"Bond yields should ease in the future on the back of falling growth and lower inflation, prompting the RBI to cut policy rates going ahead," Crisil Chief Economist D K Joshi told PTI.

The Budget announced a net borrowing of Rs 4.84 lakh crore next fiscal against Rs 4.67 lakh crore this fiscal, while the gross borrowing is pegged at Rs 6.29 lakh crore next fiscal, which is an increase of 12.72 per cent from the current fiscal, to bridge the fiscal deficit pegged at 4.8 per cent.

The gross borrowing includes repayment of existing bonds worth Rs 95,008.84 crore and buyback of Rs 50,000 crore worth of bonds 'for better debt management' as per the Budget. "Net government borrowing is as per our expectations. Though it will create an upside pressure on the yields in the near-term, it should ease in the future," Joshi said.

Earlier, a Crisil note had said G-sec yield may be around 7.7-7.8 per cent by March 2014 on the back of a possible 0.5-0.75 per cent lowering of the short term lending rate during next financial year.

A treasury official of a public sector bank said the possibility of hardening of yields is less in the near future.

"Yields of the 10 year G-sec, which has shot up by 7 bps (0.7 per cent) after the Budget to touch 7.87 per cent last Thursday, will ease from the current level. But, it may not come down drastically as expected," the official said.

The yields on 10-year benchmark G-Sec closed at 7.91 per cent on close of trading session on Friday, making 11 basis points rise during the last week alone.