FIIs pull out $3 b from Indian debt market

FIIs pull out $3 b from Indian debt market

FIIs pull out $3 b from Indian debt market

Overseas investors have pulled out over Rs 17,000 crore (nearly $3 billion) from the Indian debt market in just a fortnight due to weakness in the rupee.

During June 3-14, Foreign Institutional Investors (FIIs) were gross buyers of debt securities worth Rs 4,092 crore, while they sold bonds amounting to Rs 21,213 crore translating into a net outflow of Rs 17,121 crore ($2.98 billion), as per data available with market regulator Sebi.

Experts attributed the huge sell-off to weakness in Indian currency, which is instrumental in the FIIs exiting the debt markets as the cost of hedging a volatile rupee is rising and in turn hurting the yield differential the FIIs are working with.

Of late, the rupee has been consistently hitting record lows and it slumped to a life-time low of 58.98 in the intra-day trade against the US dollar on June 11. The rupee, on Friday, closed at 57.51 against US dollar. 

DH Newsletter Privacy Policy Get top news in your inbox daily
GET IT