Blitz Bureau
NEW DELHI: As the unemployment rate falls in the US but hiring slows down as the Federal Reserve gears up for a rate cut this month, the developments are likely to push foreign portfolio investors (FPIs) to increase their investments in India, market experts said on September 7.
Early September witnessed buying by FPIs mainly due to the resilience of the Indian market.
FPIs invested Rs 9,642 crore in equity through the exchanges and Rs 1,388 crore through the ‘primary market and others’ category till September 6.
According to Sunil Damania, Chief Investment Officer, MojoPMS, flows from FPIs are influenced by a complex interplay of factors beyond bond inclusion. Key drivers include geopolitical dynamics, the health of the US economy, Yen borrowings, and prevailing risk-off strategies.
The latest jobs data in the US indicates slowing US economy which in turn has pushed up expectations of rate cut by the Fed in September, perhaps by even 50 bp.
If the US growth concerns impact global equity markets in the coming days, FPIs are likely to use the opportunity to buy in India, said analysts.
