CENTRAL bank governor Raghuram Rajan is curbing access to India's bond market as inflows make the rupee Asia's best performer during a global currency war.
The Reserve Bank of India (RBI) hasn't allowed fresh overseas investment in government bonds since it raised the ceiling to US$30 billion in 2013. Mr Rajan said on Feb 3 that foreign investors can only buy corporate notes maturing in at least three years. Foreign investors have already filled the sovereign debt quota, which aims to prevent hot money from destabilising the market.
The rupee has climbed 1.5 per cent against the dollar this year as global funds pumped US$4.5 billion into Asia's highest yielding investment-grade debt. Mr Rajan...