Evidence of waning appetite for Indian bonds

Mumbai

IF this month's US$1.4 billion withdrawal by global funds isn't enough to signal faltering demand for Indian bonds, here's more evidence.

An auction of treasury bills failed for the first time since February on May 13, while underwriters had to rescue an offering of sovereign notes two days later in the first such forced purchases since August. A sale of 2026 government bonds on May 15 saw the least bids as a proportion of debt on offer since they were first sold in November.

Appetite is waning as a rebound in oil prices, coupled with the prospect of weak monsoon rains, clouds the outlook for cooling inflation and inter…