Foreigners are dumping Indian bonds fearing widening fiscal deficit

'Global funds have turned net sellers of India’s sovereign bonds for the first time in four months, as expectations grow of a wider budget deficit. Foreign investors sold Rs 11,000 crore ($1.5 billion) of government bonds so far in January, set for its first sell-off in four months, according to data from Clearing Corp. of India, compiled by Bloomberg. An increasing number of analysts predict that Prime Minister Narendra Modi will again announce a record borrowing plan at the 1 February budget. The sell-off may be a sign that India’s weakening economy, as well as limits on more policy rate cuts, signal the start of prolonged pain for the nation’s bond markets. The benchmark 10-year yield has gained for three consecutive weeks as Modi contends with an inflation surge and slowing growth...'