India’s switch to a monthly wholesale-price index (WPI) from a weekly gauge may make government bonds more attractive by reducing price swings, according to DBS Group Holdings and Sundaram BNP Paribas Asset Management Co.
The inflation measure will debut on November 14, Commerce Minister Anand Sharma told reporters in New Delhi yesterday. The index rose 0.9 per cent in the week to October 3, compared with a decline of 1.1 per cent in the week to June 13 and an increase of 12.9 per cent in August 2008 that was the fastest in 16 years.
“The present weekly data hide the actual trend, which is why, at times, bonds react the way they probably shouldn’t,” Ramya Suryanarayanan, an economist in Singapore at DBS, the city’s largest bank, said in an interview yesterday.