Bond-market investors are caught in a bind. The central bank, New Delhi's borrowing conduit, and the government itself have left bond traders slightly confused over the past few days, with very different signaling by the two entities that matter.
While the government reduced its additional borrowing goals by more than half in less than three weeks after announcing them, the Reserve Bank of India (RBI) went about underscoring the risks of being complacent about managing rate risks .