How to make best out of small savings rate cuts

Experts believe that the transmission will be more in the coming months. “We expect the 10-year yield falls to around 7% by December because RBI may cut 50 to 75 bps before December,” said Sivakumar. And since small savings rates are linked to market rates now, it is also expected to come down further in the coming quarters.
Though this is good news for equity and long dated bond investors, it is bad news for small savings investors. So they need to align their strategies accordingly. 

The small savings investors also need to look outside now. There will be a lot of fixed maturity plan (FMP) launches before March

31 that investors can consider. “Investing into three-year plus FMPs (ie 1,110 days) is a good option now, as the four-year indexation makes it tax efficient,” says Amol Joshi of Plan Rupee Investment Services.

For more details please click on following link :How to make best out of small savings rate cuts

 

Comments

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