Team Blitz India
NEW DELHI: Foreign inflow into Indian Government bonds hit the highest level in six years in November ahead of the securities being included in JPMorgan’s emerging market index next year, with investors and treasury officials expecting buying to continue.
Foreign portfolio investors bought a net 127.2 billion rupees ($1.53 billion) of bonds in November, the highest since June 2017, data from Clearing Corp of India showed.
Of these, around 96.6 billion rupees of purchases were securities with no investment limit, which will be included in the JPMorgan index.
“In addition to the expectation that bond yields in developed markets have peaked, Indian Government bonds are also being supported by inflows due to the index inclusion,” said Nagaraj Kulkarni, co-head for Asia rates strategy (ex-China) and head – flows strategy at Standard Chartered Bank.
He expects foreign buying in Indian bonds to continue till June, when these sectors are added to the JPMorgan index.
In September, JPMorgan announced that India will get a weightage of 10% in the index in a staggered increase between June 2024 and March 2025.
