The Indian rupee was weaker in early trade on Friday ahead of the central bank's rate decision due at 0530GMT.
The rupee was at 62.08/12 versus Thursday's close of 61.77/78.
The central bank is widely expected to keep its key policy rate steady at 7.25 percent. However, hopes have risen that the Reserve Bank of India will scale back some of its cash tightening steps.
Bond yields rose with the benchmark 10-year bond yield up 2 basis points at 8.21 percent.