In January, the rupee had appreciated over 1%, which helped foreign investment in rupee bonds turn a corner in the ensuing months. In January, the rupee had appreciated over 1%, which helped foreign investment in rupee bonds turn a corner in the ensuing months. Given that the interest rate differential between the US and India is still heavily favouring the latter, the interest of foreign investors in local bonds continues to be strong. What is working in favour of the rupee and local bonds is the shift in the outlook for the dollar and the fiscal policy of the US. For now, the outlook on India’s interest rates and currency is positive for foreign investors.

Source: Mint March 29, 2017 02:15 UTC