RBI Measures Could Draw $50 Billion Into India Bonds, Lifting Rupee
Updated
Updated · Bloomberg · Jun 8
RBI Measures Could Draw $50 Billion Into India Bonds, Lifting Rupee
3 articles · Updated · Bloomberg · Jun 8
Summary
$50 billion of expected foreign inflows into Indian bonds could support the rupee after RBI measures announced Friday, offering relief to a currency that has lagged most major Asian peers this year.
Those measures arrive as Indian markets face a tougher external backdrop: Asia's stock benchmark fell more than 2% early Monday, while a strong U.S. jobs report reinforced expectations of a Federal Reserve rate hike.
Oil also climbed after Iran fired missiles at Israel, adding pressure on India as higher energy costs feed through to domestic fuel prices and market sentiment.
The strain is already visible at home: the Nifty 50 ended Friday at a two-month low after a second straight weekly drop, while the government raised cooking-gas prices again following four fuel-price increases last month.
The broader test for policymakers is whether RBI-driven bond inflows can be sustained if global risk aversion and oil shocks continue to weigh on India's economy and assets.