Page Loader
Summarize
FIIs invest ₹18,000cr in Indian equities this May—What's the reason?
FIIs invested ₹4,243 crore in April

FIIs invest ₹18,000cr in Indian equities this May—What's the reason?

May 31, 2025
07:06 pm

What's the story

Foreign Institutional Investors (FIIs) have shown renewed confidence in Indian equities by turning net buyers for the second consecutive month. In May, they pumped in a whopping ₹18,082 crore. This comes after an earlier investment of ₹4,243 crore in April. The change comes after a period of heavy selling earlier this year due to global factors such as a strong Dollar and concerns over global interest rate movements.

Market dynamics

FII selling trend and market response

In the first three months of 2025, FIIs were consistent sellers in the Indian market. The trend began in January when the dollar index peaked at 111 mid-month. That month alone, they sold equities worth ₹78,027 crore amid fears over global interest rate movements, and a stronger Dollar. However, as global macroeconomic indicators started easing with signs of a cooling inflation and reduced interest rate volatility in the US, selling pressure eased too.

Strategic insights

Global factors influencing FII inflows

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, has attributed the recent FII inflows to global factors like slowing growth in the US and China. He also cited declining inflation and steady domestic macroeconomic indicators as reasons for this trend. "Global macros like declining dollar, slowing US and Chinese economies and domestic macros like high GDP growth and declining inflation and interest rates are the factors driving FII inflows into India," he said.