RBI hikes FII investment sub-limit in govt bonds by $5 billion

The Reserve Bank on Wednesday hiked the FII investment sub-limit in govt bonds by USD 5 billion.

Updated: Jul 23, 2014, 18:31 PM IST

Zee Media Bureau

The Reserve Bank on Wednesday hiked the FII investment sub-limit in govt bonds by USD 5 billion.

Further, the RBI also cut limit for long-term investors by USD 5 billion.

The incremental investment limit of USD 5 billion shall be required to be invested in government bonds with a minimum residual maturity of three years.

Further, all future investment against the limit vacated when the current investment by an FII/QFI/FPI runs off either through sale or redemption shall also be required to be made in government bonds with a minimum residual maturity of three years.

It is, however, clarified that there will be no lock-in period and FIIs/QFIs/FPIs shall be free to sell the securities (including that are presently held with less than three years of residual maturity) to the domestic investors.