Foreign portfolio investors (FPI) poured in over Rs 2,300 crore in the Indian capital markets in July, after pulling out funds for three months in a row, largely due to expectations of a lower trade deficit following a correction in crude oil prices.

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The latest inflow comes after such investors had taken out more than Rs 61,000 crore from the capital markets (equity and debt) during April-June. Prior to that, FPIs had invested Rs 2,662 crore in March.

According to the latest depository data, FPIs pumped in a net sum of Rs 2,264 crore in equities in July and Rs 48 crore in the debt market, taking the total net investments to Rs 2,312.

“The inflows were more in line with what has been happening around in the world, but can’t attribute anything specific except that correction in crude prices could actually lead to the lower trade deficit and (ease) the pressure on the currency,” said R Sreesankar, head of institutional equities at Prabhudas Lilladher.

Susmit Patodia, head of sales at Motilal Oswal Institutional Equities, said FPIs returning back to India in July is a significant positive, considering it coincides with slowing down of domestic flows.

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Overall, so far this year, FPIs have withdrawn nearly Rs 4,100 crore from equities and over Rs 38,000 crore from the debt markets.