Foreign portfolio investors sharply accelerated their selling in the first week of December, pulling out ₹11,820 crore from Indian equities as the rupee weakened to its lowest levels of the year. The withdrawal follows a net outflow in November, adding fresh pressure on the markets despite strong domestic resilience.
Official data shows FPIs have now withdrawn ₹1.55 lakh crore in 2025, reversing the brief recovery seen in October. Analysts say currency volatility has been the primary trigger. The rupee has depreciated nearly 5% this year, and FPIs typically retreat during such phases. Year-end portfolio realignment by global funds has intensified the selling, while uncertainty over the delayed India&ndash;US trade agreement has further dampened risk appetite.
However, robust domestic inflows have helped absorb foreign selling almost entirely. DIIs purchased ₹19,783 crore worth of equities during the same period, buoyed by stronger GDP numbers, improved corporate earnings outlook and the RBI&rsquo;s 25-bps rate cut on December 5. Notably, FPIs briefly turned buyers on the day of the policy announcement, adding ₹642 crore as the central bank raised its FY26 growth projection to 7.3% and cut its inflation estimate.
Market watchers say global liquidity could improve in the coming weeks. The CME FedWatch Tool indicates high probability of a US Fed rate cut next week, a move that typically benefits emerging markets. &ldquo;India will be one of the key beneficiaries if global liquidity eases, though the unresolved India&ndash;US trade deal remains a significant risk,&rdquo; said analyst Vaqarjaved Khan. In the debt market, FPIs made modest purchases under the general route while trimming exposure through the voluntary retention window.

FPIs Pull ₹11,820 Crore Amid Rupee Slide

Rupee weakness, year-end reshuffles drive sharp FPI outflows despite strong DII support

FPIs Pull ₹11,820 Crore Amid Rupee Slide

Rupee weakness, year-end reshuffles drive sharp FPI outflows despite strong DII support

December 7, 2025 | 22:24 IST