There are a couple of reasons for a fall in the passive fund flow. First, the return on active large cap funds have been superior to passive funds over the past 12 months. For instance, ICICI Pru Blue Chip, the biggest large cap fund from ICICI Prudential Asset Management Company, delivered 37.4% return while its largest ETF gained 25.3% during the period.
Market expects one more rate cut as inflation stays benign
Indian economists and bond market experts expect another quarter percentage point cut in policy rates. This follows the Reserve Bank of India’s recent rate reduction