India’s 10-year sovereign notes completed their first weekly drop in three weeks as Urjit Patel’s appointment as the next central bank chief dashed speculation that monetary policy will be eased aggressively.
Bonds had rallied since June after Reserve Bank of Governor Raghuram Rajan’s announcement that he will step down when his term ends in early September sparked speculation his successor will be more willing to lower policy rates. Patel’s elevation from deputy governor disappointed some investors because he had burnished his inflation-fighting credentials by advocating consumer-price targeting and the formation of an independent monetary policy panel.
