It is time to move money to India
The Indian rupee is trading at a new six-month low on global dollar strength. It is was trading at 55-56 range. There are several reasons why the INR has depreciated even though country is witnessing record inflows.
It is said before the monsoon season, India imports for oil, fertilizer and other chemicals go up. Falling gold prices has added to CAD woes. India imported record Gold and Silver. [Gold and silver imports surged to $7.5 billion last month ]. Further appreciating US$ has put pressure on all world currencies including INR.
With this backdrop, it might make sense to move money to India now rather than later, if the money is kept in 0% checking account in India or in risky US bond funds. [ Please read why US bond funds should be avoided now ]
Bond funds in India are yielding 9-10% and total return of these bonds are expected to go up once the RBI reduce the interest rate further. And we are not forecasting another 10% drop in INR against USD in near future. Hence it is good idea to move the short term goals money now.
There is excess liquidity and is trying to find itself flowing towards risky assets. This trend will strengthen the money flow to India through FII and FDI. Hence the INR will be caught in a range for some time.
If your long term goals demand money for Indian stock market, move lumpsum money now to Indian fixed income funds and deploy these funds slowly using VTP or STP methods into stock market.