Pankaj Vaish, global head of local markets rates and treasury at Citi, spoke to CNBC-TV18 about the global growth and US Treasury yield curve.

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“The yield curve in the US has a very good track record, it is even better than Federal Reserve’s track record in terms of calling recessions or calling the extent of growth and certainly better than most economist out there and so I take it very seriously,” Vaish said on Tuesday.

Vaish said," Yields have not touched zero yet but I use the yield curve as a premier benchmark in terms of probability of recession."

“The hunger for yield is no longer just in the core developed markets but in a lot of emerging markets where in the past we used to think of a risk-off environment as yields will go higher, actually yields are going lower,” he said.

On the global growth front, Vaish said, “The view is that growth in the US, China, Japan and Euroland is not there and so emerging markets coming into this year were favourite category,” he said, adding that, “If you see at Nifty versus what bonds are telling us there is disconnect. The same thing in the US, Mexico," he added.

Talking about the FII view on India, he said, "There was a lot of excitement within the investor community related to the elections. They are just happy that there is a strong mandate and stable government for five years and are choosing big names and not so many midcaps."

The house is upbeat on Indian equities and feels that even if S&P were to fall 10-15 percent, Indian equities would be a good bet.

First Published:Jun 4, 2019 11:53 AM IST