FPIs Infuse Over Rs 15,000 Crore in Debt Market in February – News18

Foreign Portfolio Investors (FPIs) continued their bullish stance on the nation’s debt markets with a web infusion of over Rs 15,000 crore to date this month, on the again of inclusion of Indian authorities bonds in the JP Morgan Index together with comparatively secure financial system. This adopted a web funding of Rs 19,836 crore in January, making it the best month-to-month influx in greater than six years. This was the best influx since June 2017, after they infused Rs 25,685 crore.

On the opposite hand, international buyers pulled out greater than Rs 3,000 crore from equities through the interval below evaluation. Before this, they withdrew an enormous Rs 25,743 crore in January, knowledge with the depositories confirmed. “The main trigger for this divergent trend in equity and debt is the high valuation in the Indian equity market and the rising bond yields in the US,” V Okay Vijayakumar, Chief Investment Strategist, Geojit Financial Services, stated.

Himanshu Srivastava, Associate Director – Manager Research, Morningstar Investment Research India, attributed the outflow from equities to the uncertainty surrounding the rate of interest atmosphere, each domestically in addition to globally. According to the info, FPIs made a web funding of Rs 15,093 crore in the debt markets in this month (until February 9).

With this, the entire funding by FPIs reached over Rs 34,930 crore in 2024. They have been injecting cash in the debt markets for the previous few months.

FPIs infused Rs 18,302 crore in the debt market in December, Rs 14,860 crore in November, and Rs 6,381 crore in October. “The Indian debt markets witnessed a reversal in FPI flow trend last year after the announcement of inclusion of Indian government bonds in the JP Morgan Index. This was one of the major drivers for the robust flows from FPIs, along with relatively stable economy,” Srivastava stated.

JP Morgan Chase & Co. in September final yr introduced that it’s going to add Indian authorities bonds to its benchmark rising market index from June 2024. This landmark inclusion is anticipated to profit India by attracting round USD 20-40 billion in the following 18 to 24 months.

This influx is anticipated to make Indian bonds extra accessible to international buyers and doubtlessly strengthen the rupee, thereby bolstering the financial system, he added. Overall, the entire FPI flows in 2023 stood at Rs 1.71 lakh crore in equities and Rs 68,663 crore in the debt markets.

Together, they infused Rs 2.4 lakh crore into the capital market. The move in Indian equities got here following a worst web outflow of Rs 1.21 lakh crore in 2022 on aggressive charge hikes by the central banks globally. Before the outflow, FPIs invested cash in the final three years.

(This story has not been edited by News18 employees and is printed from a syndicated information company feed – PTI)