NEW DELHI: Foreign Portfolio Investors (FPIs) have turned cautious again, pulling out Rs 20,974 crore from Indian equities so far in Sept amid global uncertainties, higher US interest rates and bond yields, elevated crude oil prices and a weakening rupee.The latest outflow comes after foreign investors returned to Indian equities in July and Aug, when they invested Rs 20,200 crore and Rs 29,630 crore, respectively, according to data from CDSL.With the Sept selling, FPIs have now withdrawn a total of nearly Rs 2.5 lakh crore from Indian equities so far in 2026, surpassing the just under Rs 1.7 lakh crore outflow recorded during the entire 2025.According to the data, FPIs withdrew Rs 20,974 crore from Indian equities this month, till Sept 18. However, the trend of FPI investment through the primary market has been continuing in the month.
Dheeraj Gaur, chief investment strategy officer at Choice Wealth, attributed the latest selling by FPIs to three key factors — higher US interest rates and yields, elevated crude oil prices amid geopolitical tensions, and weakness in the Indian rupee.The Federal Reserve has raised rates to 3.75-4%, with the narrowing yield differential between India and the US reducing the relative attractiveness of Indian assets. At the same time, Brent crude has remained above $100 a barrel, with escalating tensions in West Asia adding to concerns over inflation and India’s import bill, he said. The rupee has also come under pressure, declining 1.1% in the previous week. It traded at a record low of 95.92-95.96 per US dollar and breached the 96-mark intraday, adding to concerns for foreign investors, he added.“Sept’s FPI selling is a crude-and-dollar story, not an India story. When oil spikes and US yields firm up, money leaves every emerging market and India isn’t being singled out,” Vedant Gupte, co-founder and CEO of Investment platform Trackk, said.agencies
