Whenever we talk about savings, the first thing that comes to mind is Fixed Deposit (FD). Though we have several investment options in this era, people still believe in FDs for safe investment. It is said that investments in FDs are secure with guaranteed returns. Some people have moved to Mutual Funds as their investment option in expectation of more returns. Are you presently planning to invest in an FD? If you are planning to do so, you should do it quickly as the Reserve Bank of India (RBI) might reduce the interest rates in the coming days.
Credit rating agency Crisil mentioned in its report that the Reserve Bank of India might start lowering interest rates from October. This change in interest rates will depend on external factors like weather conditions and international commodity prices. The agency further stated that two rate cuts might take place in the present financial year.
According to recent reports, the RBI did not make any changes to the interest rates. The Monetary Policy Committee (MPC) recently mentioned in its announcement that they have decided to keep the same interest for now due to high food inflation. The Committee stated that they would monitor the climatic changes and other factors before taking such an important decision. It was further anticipated that the macroeconomic environment would improve soon, setting the perfect stage for a rate cut.
S&P’s arm mentioned in its report, “The challenge of cutting the interest rates is expected to ease as the agricultural prospects look better this year compared to last year. The monsoon season has been above normal. Farming of major crops in the country has shown a positive response. The agricultural scenario will become clearer by September, after which the rate cuts might take place.” The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) has recently announced that they will keep the repo rate steady at 6.5 per cent.
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