Modi Euphoria Threatens to Turn Into Bond Ennui as Reforms Slow
- India story ‘more boring now’ as Brazil appeals, says Ashmore
- Rupee stability, credible central bank keep India attractive
Narendra Modi.
Photographer: Graham Crouch/BloombergThis article is for subscribers only.
Massive, game-changing and overwhelming were among the descriptions investors used for Indian Prime Minister Narendra Modi’s election victory in May 2014. Two years on, the slow pace of implementing policy threatens to sap interest.
The rupee is the worst performer among currencies of the four biggest emerging markets this year. Indian sovereign bonds have lagged peers in Brazil and Russia this quarter, after delivering the best returns among the BRIC nations since the election win. Global investor holdings of rupee debt, which almost doubled in Modi’s first year, have slipped about 1 percent in his second.