(Bloomberg) -- Lakshmi Iyer, who helps manage $22.7 billion as chief investment officer at Kotak Mahindra Asset Management Ltd., used a Bollywood tune to explain the Indian central bank's embrace of unconventional monetary policy.
The Reserve Bank of India's decision to emulate the Federal Reserve's “Operation Twist” is the authority's way to signal “main hoon na,” Iyer said, referring to the popular star Shahrukh Khan's song, which loosely means, “Fear not, I am here.”
Read more: Operation Twist Makes India Long-Tenor Debt Asia's Top Performer
“The relentless steepening of the yield curve is getting pacified by the RBI's coming in and signaling I am here to support,” Iyer said. “There was general apathy at the long-end of the curve, so much so that ultra-premium was being paid to the short-end. That's correcting right now.”
To contact the reporter on this story: Kartik Goyal in Mumbai at kgoyal@bloomberg.net
To contact the editors responsible for this story: Arijit Ghosh at aghosh@bloomberg.net, Jeanette Rodrigues
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