By Vineet Kumar 
Where Is FII Money Flowing Now?
Foreign Institutional Investors (FII) made some big moves in January 2025, and India, unfortunately, saw one of the highest outflows. But it’s not just India—several emerging markets faced the heat, while a few economies managed to attract strong inflows. Let’s break it down country by country.
Country-Wise Breakdown of FII Flows (January 2025)
1. Japan: $3,888 million (Inflow) ✅
Japan emerged as a clear winner, benefiting from its reputation as a safe-haven market. With Trump-era trade policies emphasizing strong U.S.-Japan ties, investors likely saw Japan as a stable destination.
2. South Korea: $-1,002 million (Outflow) ❌
South Korea faced outflows, possibly due to shifting global supply chains and renewed trade tensions. If Trump’s policies influenced global trade structures, Korea’s exposure to U.S.-China dynamics may have played a role in these capital movements.
3. Taiwan: $-1,158 million (Outflow) ❌
Taiwan has always been at the center of U.S.-China trade frictions. With renewed geopolitical uncertainties, FIIs may have pulled funds, anticipating volatility.
4. Vietnam: $-1,158 million (Outflow) ❌
Vietnam, often considered an alternative to China for global manufacturing, surprisingly saw outflows. This could indicate a market correction or broader risk aversion among institutional investors.
5. India: $-8,418 million (Outflow) ❌
India saw one of the biggest FII outflows in January 2025. Several factors may have contributed:
Overvaluation concerns in the Indian stock market.
Rupee volatility affecting foreign investor confidence.
Global risk-off sentiment making FIIs shift funds to safer assets.
This massive outflow signals that foreign investors may be taking a cautious stance on India, at least in the short term.
6. Brazil: $-292 million (Outflow) ❌
Brazil saw moderate outflows, possibly due to fluctuations in global commodity prices. Since the country’s economy is heavily dependent on commodities, any shifts in U.S. trade policies or demand can directly impact investor sentiment.
7. Indonesia: $1,158 million (Inflow) ✅
Indonesia stood out with solid inflows, thanks to stable economic conditions and strong investor interest in emerging markets. Compared to its regional peers, Indonesia’s policy stability and growth outlook likely played a role in attracting foreign money.
Trump-Era Policies & Their Influence on FII Flows
The ripple effects of Trump’s trade policies can still be felt in global markets.
Trade tensions between the U.S. and China continue to influence capital flows, particularly in Asian markets.
A shift in global investment strategies has led to increased focus on politically stable and economically strong nations.
A strong U.S. dollar has made emerging market assets less attractive to FIIs.
Final Thoughts
With India witnessing a record FII outflow, investors will be closely watching policy changes, economic data, and global market trends. While short-term volatility is concerning, long-term investors may see this as a buying opportunity if valuations correct.
Stay tuned to TradingThought for the latest stock market insights and FII updates!
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