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By Bloomberg

Indian sovereign bonds fell for a fourth day, pushing the 10-year yield to a one-week high, on speculation faster inflation will deter the central bank from cutting interest rates.

Consumer prices probably rose 5.10 percent in June from a year earlier, according to the median estimate in a Bloomberg survey before official data due July 13. That’s faster than May’s advance of 5.01 percent. The government plans to sell 150 billion rupees ($2.4 billion) of notes at a weekly auction Friday, a statement from the Reserve Bank of India shows. The rupee was steady this week.

The yield on the securities due May 2025 climbed one basis point to 7.80 percent as of 10:45 a.m. in Mumbai, heading for its highest close since July 2, according to prices from the RBI’s trading system.

“The broad consensus is for a higher inflation number and that is keeping the market cautious,” said Soumyajit Niyogi, an interest-rate analyst at primary dealer SBI DFHI Ltd in Mumbai. “Below-normal rainfall is also hurting sentiment.”

Concern over price pressures has resurfaced as potentially deficient monsoon rains threaten to hurt crops and stoke food costs, which make up about half of India’s CPI basket. The weather bureau predicts the June-September showers to be 88 percent of a 50-year average this year. Rainfall has been 4 percent below normal since June 1.

RBI Governor Raghuram Rajan linked further policy action to the strength of the monsoon as he cut benchmark borrowing costs for a third time this year on June 2.