FPIs again turn net buyers of govt securities in Dec
Financial Express Chandigarh|January 01, 2025
AFTER TURNING NET sellers of government bonds under the fully accessible route (FAR) for the first time since India's inclusion in the JP Morgan Global Market Index - Emerging Suite in November, foreign portfolio investors (FPIs) have again turned net buyers in December.
ANUPREKSHA JAIN

FPIs increased their positions held under the fully accessible route to ₹2.51 lakh crore against ₹2.43 lakh crore a month ago.

The appointment of the new governor of the Reserve Bank of India has boosted the expectations of a rate cut in February.

This prompted foreign investors to take a positive view on the government bond market despite the rupee being under pressure. The new RBI governor, Sanjay Malhotra, is perceived to be dovish in his approach, therefore, the market is confident about India going for a rate cut in February, said traders.

If the central bank does not go for a rate cut as expected, it may announce additional measures to infuse liquidity in the market, such as open market operations or buybacks.

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