FII debt limit hike credit-positive, says Moody's

Tags: Stock Market
India's measures to raise the investment limit for foreign institutional investors (FIIs) in government bonds is a positive for the country's credit profile since it will help stabilise domestic interest and currency rates, Moody's Investors Service said on Monday.

The credit rating agency added the revised investment limit was also small enough to limit impact on India from changes in overseas demand for debt, according to a weekly report.

"Raising the limit for foreign institutional investors is credit positive for the Government of India because it will increase foreign investment in government securities over the next several months," Moody's said.

The Reserve Bank of India last week increased the limit available for foreign institutional investors by $5 billion to $25 billion but kept the overall limit intact by lowering the limits for long-term foreign investors such as sovereign wealth funds.

Moody's rates India with a "Baa3" rating, the lowest investment-grade rating, and a "stable" outlook.

EDITORIAL OF THE DAY

  • India seems to pull out all stops when it comes to non-war measures against Pakistan

    After a decision to fully exercise its rights on the Indus water treaty, Narendra Modi government opened another front to hit at Pakistan’s economic

FC NEWSLETTER

Stay informed on our latest news!

TODAY'S COLUMNS

M S Swaminathan

Strategy for freedom from malnutrition

There is now a growing realisation that linking agriculture and ...

Zehra Naqvi

The fountain of eternal youth

The pursuit of eternal youth is a multi-billion dollar industry ...

Shona Adhikari

Where Bhupen Khakhar rubs shoulders with Georgia O'Keeffe

The next India Art Fair (IAF) is scheduled to take ...