FIIs back in debt market with Rs11,000-crore investment in February

Foreign financial institutions (FIIs) have invested around Rs11,000 crore in Indian debt market so far in February after being net sellers in bonds in 2013.

According to market watchers, FIIs are back in the debt market on account of the stability in foreign exchange and interest rates.

FIIs bought debt securities worth a total Rs21,210 crore and sold bonds worth around Rs10,219 crore till 21 February, resulting in a net inflow of Rs10,991 crore ($1.77 billion), according to data available with the Securities and Exchange Board of India (SEBI).

The FII pull-out started after the US Federal Reserve first indicated in May that it would taper its stimulus programme. The Fed subsequently started reducing its bond purchases in January.

In 2013, overseas investors withdrew Rs50,847 crore ($8 billion) from the bond market and infused Rs1,13,000 crore ($20.1 billion) in equities.

As of 21 February, there were 1,726 registered FIIs in the country and 6,367 sub-accounts.

The rupee, which touched an all-time low of 68.85 in August, has recovered and closed at 62.12 against the dollar on Friday.