Currency woes: FPIs take deeper cuts in portfolios than domestic players

Domestic buyers are increasing their stakes even as foreign investors have been exiting, noted an April 27 India Equity Strategy Report by Morgan Stanley

Foreign portfolio investors (FPIs) have seen deeper cuts in their portfolio than domestic players as the rupee touched an all-time low against the dollar.

One dollar was worth Rs 77.53 on Monday, a record low. It was at 77.32 on Tuesday. A fall in the rupee worsens the returns for foreign portfolio investors. The value of any Indian holdings are lower in dollar terms when the rupee falls against the greenback.

The benchmark returns are correspondingly worse for the S&P BSE Dollex 30 index compared to the S&P BSE Sensex from the all-time high. The Sensex is an index of