 "FIIs pump in Rs 2,600 cr in capital market in a week")
The net inflows during the week followed a net withdrawal of nearly Rs 16,000 crore (about $2.5 billion) from the Indian capital markets in August -- the lowest outflows in three months.
During the week, inflows were about Rs 1,689 crore ($256 million) in the debt market and Rs 882 crore ($135 million) in the equities translating into a net inflows of Rs 2,571 crore ($392 million), as per latest data available with market regulator Sebi.
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Market analysts said that renewed buying by foreign institutional investors (FIIs) were witnessed after Raghuram Rajan took over as the RBI chief and announced a slew of measures to attract capital flows and boost economic growth.
Rajan, who took over as RBI chief on Wednesday, had announced steps to attract dollar inflows, including enhanced limits for exporters to re-book cancelled forward exchange contracts and a window to swap foreign currency deposits.
The local currency, which has been deprecating since May, has spurted 239 paise, or 3.53%, in past three sessions. Rupee closed at 65.24 against the dollar on Friday.
There has been turmoil in the global markets after the US Federal Reserve said it may taper the $5-billion-a-month bond purchase programme later this year and end it next year if the US economic recovery is up to its expectations.
The Fed's ultra-loose monetary policy has driven asset prices higher, including those in emerging markets, and fears are that inflows may be hit if the US monetary stimulus comes to an end.
So far this year, foreign investors have infused a net Rs 61,052 crore ( $11.7 billion) in equities, while overseas investors have withdrawn nearly Rs 38,460 crore ($6.2 billion) from the debt market.