Bank Debt Has Worst Start Since 2007 on Inflation: India Credit
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Indian banks’ dollar bonds are heading for their worst January since before the credit crisis as the fastest inflation in Asia spurs customers to buy gold and property, while deposits fail to keep pace with loans.
The notes returned 0.36 percent this month, their weakest start to a year since they delivered 0.29 percent in January 2007, according to HSBC Holdings Plc’s Indian Dollar Bond Index, which is 71 percent bank debt. HSBC data show a 0.71 percent return for lenders in South Korea, where inflation at 3.5 percent is less than half India’s 8.4 percent.