Indian government bonds erased early advances on Thursday, as a report stating that the central bank is mulling a rate hike to control the rupee's decline overshadowed positive global cues. The benchmark 6.48% 2035 bond yield was at 7.1225%, as of 10:15 a.m. IST, rocketing back up from a low of 7.0194% hit earlier, and against its previous close of 7.0761%. Bond prices move inversely to yields. "The report has caught the bond market completely off guard, triggering an immediate reassessment of the rate outlook and wiping out the early gains," trader with a state-run bank said. The Reserve Bank of India (RBI) is considering all options to stabilize the rupee, including an interest rate hike, Bloomberg News reported on Thursday, citing people familiar with the matter.