Swaps Show Subbarao Rates Peak as Inflation Slows: India Credit
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The Reserve Bank of India, after raising interest rates 1.25 percentage points this year, is coming to the end of the most restrictive credit-tightening in Asia with inflation abating and companies signaling a peak in their short-term borrowing costs.
The cost of fixing rates on money for three years in the market for so-called interest-rate swaps, tumbled 37 basis points in August, the most in 20 months, to 6.57 percent, data compiled by Bloomberg show. The last time they fell as much was in December 2008, when Reserve Bank of India Governor Duvvuri Subbarao cut rates to shield the economy from the global recession.