Shifts in the Indian central bank's policies and communication, from theearly closingof a window that encouraged dollar inflows to policy minutes thatsignalled interest rate hikes, have flattened India's bond yield curve as short-endyieldsrise while longer-term yields decline on strong demand.
Shorter maturity bond yields had fallen since June, helped by non-resident Indian dollar deposits and overseas debt raises that were being invested in short-term debt, while the Reserve Bank of India indicated little urgency to hike rates at its August meeting.
