By Anoop Agrawal June 9 (Bloomberg) -- India’s 10-year bonds fell, with the yield rising from a two-week low, before the government’s sale of 110 billion rupees ($2.3 billion) of notes this week. The securities snapped a three-day gain on speculation banks have fewer funds to invest in debt after mobile-phone operators paid 677.2 billion rupees to the government last week for third-generation wireless licenses. Notes maturing in 2015, 2020 and 2032 will be on offer June 11. “We are seeing some selling because of the debt sale ahead at a time when cash in the system is not very high,” said Roy Paul, a deputy general manager at Federal Bank Ltd. in Mumbai. “Yields are going to rise to a higher band.” The yield on the benchmark 7.80 percent note due May 2020 climbed two basis points to 7.48 percent as of 9:25 a.m. in Mumbai, according to the central bank’s trading system. The price fell 0.11, or 11 paise per 100 rupee face amount, to 102.22. Indian banks, the biggest buyers of government debt, borrowed a net 676.25 billion rupees from the central bank through repurchase auctions yesterday, according to data compiled by Bloomberg. --Editors: Simon Harvey, James Regan To contact the reporters on this story: Anoop Agrawal in Mumbai at aagrawal8@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net

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