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Swap rates in India surge as traders see Reserve Bank turning hawkish

The five-year onshore overnight indexed swap, a tool to trade rate expectations, has advanced 31 basis points in October

RBI ( Bloomberg)
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Traders globally are betting that central banks will have to hike rates faster than projected as pandemic-era inflation become entrenched ( Photo: Bloomberg)

Subhadip Sircar | Bloomberg
Swap rates are rising in India in a sign that traders expect the central bank to roll back monetary stimulus quicker than expected despite its reassurances.

The five-year onshore overnight indexed swap, a tool to trade rate expectations, has advanced 31 basis points in October to 5.64%. It’s poised for the biggest monthly gain since February when the government said the economy had exited a recession before a Delta variant outbreak.  

Traders globally are betting that central banks will have to hike rates faster than projected as pandemic-era inflation become entrenched. While price pressures in India eased in the past

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First Published: Oct 27 2021 | 11:00 AM IST

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