Overseas investors have pumped in over Rs 3,500 in the Indian debt market so far in January, when the US Federal Reserve is scheduled to start reducing its monthly bond purchases by USD 10 billion.
Foreign institutional investors (FIIs) were gross buyers of debt securities worth Rs 8,155 crore and sellers of bonds to the tune of Rs 4,609 crore till January 10, resulting in a net inflow of Rs 3,546 crore (USD 572 million), according to Sebi data.
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FIIs also invested Rs 545 crore in the equity market. Their total investment in debt and equity was about Rs 4,091 crore.
According to market experts, FIIs inflow in debt market is returning on account of some stability observed in foreign exchange and interest rates.
The US Federal Reserve decided to taper its monthly bond-buying programme, raising concerns that funds available for investing in emerging markets may be reduced.
Starting this month, the US central bank will cut its bond purchases to USD 75 billion from USD 85 billion, according to a statement after the Federal Open Market Committee meeting on December 18.
In 2013, overseas investors pulled out a net amount of Rs 50,847 crore (USD 8 billion) from the bond market in 2013, while they infused a net Rs 1.13 lakh crore (USD 20.10 billion) in equities.
As of January 10, the number of registered FIIs in the country stood at 1,724 and the total number of sub-accounts was at 6,400.
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