For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

Is It A Good Time To Invest In Fixed Deposits?

|

On February 7, following the bi-annual monetary policy meet, the Reserve Bank of India (RBI) announced 25 basis points cut in repo rate to 6.25 percent. It is common understanding that the repo rate cut would mean cheaper loans but it will take a while before the changes are reflected in the lending rates by banks.

Also Read: Here's Why The RBI's Rate Cut Should Not Impact Your Home Loan Decisions

Is It A Good Time To Invest In Fixed Deposits?
 

Similarly, banks will also start reducing the interest rates offered on deposits made to them. So, if you are a risk-averse investor waiting for the right time to put your money in a fixed income instrument, you shouldn't wait longer.

Financial experts have suggested that the surprise rate cut by RBI would mean that it is unlikely that the rate would go up any time soon. Also, considering the low level of inflation and prevailing currency volatility, the interest rate may not fall further as well.

If you do plan on investing in debt mutual funds, fixed deposits or bonds, you should act on it as soon as possible to avoid missing out on the current rates.

Other experts feel that the gap between deposit rate and bank credit growth is likely to make private banks offer higher rates to mobilize deposits. They advice on investing in FD right now but for tenures as long as 1 to 2 years only.

Ultimately, an investment decision should be based on your risk appetite and financial goals rather than on future expectations of an interest rate hike. Invest wisely.

Read more about: fd fixed deposits
Story first published: Saturday, February 16, 2019, 14:58 [IST]
Company Search
Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X
We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more