BlackRock's India Venture Buys Long Bonds as Rate Cut Room Seen
- Yield on 15-year sovereign notes has dropped 27 basis points
- Quarter-point RBI rate cut more or less priced in, fund says
This article is for subscribers only.
The Indian venture of the world’s largest money manager is buying longer-dated debt as bonds extend a rally triggered by the government’s fiscal restraint and signs the central bank will cut interest rates.
“We are reallocating more money in the 10-15 year segment of the government bond yield curve which is liquid and offers potential price appreciation,” said Dhawal Dalal, Mumbai-based head of fixed income at DSP BlackRock Investment Managers Pvt., which oversees 392 billion rupees ($5.8 billion). “There’s been a marked improvement in sentiment since the budget and with global markets stabilizing, market participants expect the Reserve Bank of India to reduce the repurchase rate further.”