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Quote on FPI/FII market 19 August  2022 By Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

"FPIs turned net buyers in the Indian market in July and the buying momentum increased in August with steady buying through the exchanges. As per NSDL data FPIs have bought equity worth Rs 40770 cr this month as on August till 19th. The main trigger for the sustained buying has been the steady fall in the dollar index from above 109 in end July to around 105 recently. But on the 19th the dollar index has again moved up and crossed 107. If this trend continues capital inflows might be impacted. FPIs have been buyers in the debt market too with a net buy a figure of Rs 2104 cr till 19th August.

The near-term trend in capital flows will be influenced mainly by the movement of the dollar. In emerging markets, India is likely to outperform with the best GDP growth this year and the next. So, India is likely to attract more capital flows compared to other emerging markets. However, the elevated valuations in India are a concern"

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