How have the foreign investor flows been so far in the month of February 2020 and what is it likely to show direction?

February started off in a positive note, at least in debt flow if not in equity flows. There was some respite on the FPI flows front, although most of the flows came in through the debt route in February. In the first week of February, FPIs pumped in Rs.6350 into debt but pulled out Rs.1177 from equities resulting in net inflow of Rs.5177 crore in the first week. The sharp inflow into debt was largely on account of the RBI keeping an accommodative stance in its February monetary policy. The massive liquidity infusion via LTROs to the tune of nearly Rs.1 trillion each fortnight is already pressuring yields lower. The Chinese virus pandemic also led to greater flows into India as it was least vulnerable to the pandemic compared to other South East Asian nations. All in all, February promises to be a good month for FPI flows, although it is not certain if equity flows will show traction.