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FPIs Sold Equities Worth ₹8749 Crore This Week, However Sharp Turnaround Seen After RBI Rate Cut

  • Foreign portfolio investors turned net sellers by withdrawing ₹8,749 crore from Indian equities in the first week of June 2025.
  • Following months of mixed foreign investment activity, recent selling was driven by escalating trade disputes between the US and China, an increase in US government bond yields, and an ongoing US investigation into the Adani Group's alleged sanctions breach.
  • FPIs also pulled out ₹6,709 crore from debt general limits and ₹5,974 crore from voluntary retention during June 2-6 amid narrow bond yield spreads between India and the US.
  • The Reserve Bank of India surprised markets by lowering the repo rate by half a percentage point to 5.5% and implementing a phased reduction of the cash reserve ratio totaling 100 basis points.
  • This policy boost improved market sentiment, is expected to ease credit conditions, and reflects RBI's confidence in keeping inflation near 3.7% for FY26 while supporting economic growth above 6%.
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Reserve Bank of India: Although those who have already made an FD at a specific rate will get a return at that rate.

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Goodreturns broke the news in on Thursday, June 5, 2025.
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