- Date : 27/06/2022
- Read: 2 mins
- Read in हिंदी: बचत योजनाओं की ब्याज दरें जल्दी ही बढ़ सकती हैं
Upward revision on small saving schemes soon
RBI has increased the repo rate by 0.9% in the last quarter. In an unscheduled policy review, the central bank had hiked repo rates in May by 0.4%. Also, 0.5% was raised in the scheduled MPC meeting in June. The 10-year G-sec yield has risen to 7.4%. The savers are battling higher inflation as it continues to feed savings. Against this backdrop, there might be some positive news for savers soon.
Related: https://www.tomorrowmakers.com/retirement-planning/5-ways-reset-your-retirement-savings-and-save-more-2022-article
If the reports are to be believed, small savers might have some good news by the month-end. Small saving schemes have not increased interest rates since June 2020. But this might soon change as per the reports. Several Indians, especially the retired population, depend on small savings schemes to save money. These schemes offer higher interest rates as compared to the banks. The best part about small saving schemes is that the government backs them.
The interest rates on small saving schemes are linked to the G-sec yields. The G-sec yields have increased in the last year. The ten-year G-sec yield has increased from 6% in June 2021 to 7.4% in June 2022. This increase in the treasury yields was because of the expectation of an increase in the repo rate by the RBI. Now that the RBI has increased the repo rates, you can expect the small saving scheme rates to increase soon. If the reports are to be believed, this might be done by the end of this month.
Currently, the PPF interest rate is 7.1%, the National Savings scheme interest rate is 6.8%, Kisan Vikas Patra interest rate is 6.9%, and the Sukanya Samridhi Yojana interest rate is 7.6%. Five years Senior Citizens Savings scheme interest rate is 7.4%, and the FD rates at various banks are 5-6%.
The increase in G-sec yields puts pressure on the government to increase the small saving interest rates. Aditi Nayar, Chief Economist at ICRA, said the bond markets' nervousness could come down if the small saving scheme interest rates are increased. She expects the 10-year G-Sec rates to rise to 7.75-7.8% in the upcoming quarter. Thus, one can expect the small saving scheme interest rates to be revised soon.
Conclusion
The increase in 10-year G-sec rates puts pressure on the government to increase the small saving scheme rates. As per the reports, these upward revisions might be done by the month-end. You can expect the small saving schemes to increase soon as per various reports and the analysis by top economists.
RBI has increased the repo rate by 0.9% in the last quarter. In an unscheduled policy review, the central bank had hiked repo rates in May by 0.4%. Also, 0.5% was raised in the scheduled MPC meeting in June. The 10-year G-sec yield has risen to 7.4%. The savers are battling higher inflation as it continues to feed savings. Against this backdrop, there might be some positive news for savers soon.
Related: https://www.tomorrowmakers.com/retirement-planning/5-ways-reset-your-retirement-savings-and-save-more-2022-article
If the reports are to be believed, small savers might have some good news by the month-end. Small saving schemes have not increased interest rates since June 2020. But this might soon change as per the reports. Several Indians, especially the retired population, depend on small savings schemes to save money. These schemes offer higher interest rates as compared to the banks. The best part about small saving schemes is that the government backs them.
The interest rates on small saving schemes are linked to the G-sec yields. The G-sec yields have increased in the last year. The ten-year G-sec yield has increased from 6% in June 2021 to 7.4% in June 2022. This increase in the treasury yields was because of the expectation of an increase in the repo rate by the RBI. Now that the RBI has increased the repo rates, you can expect the small saving scheme rates to increase soon. If the reports are to be believed, this might be done by the end of this month.
Currently, the PPF interest rate is 7.1%, the National Savings scheme interest rate is 6.8%, Kisan Vikas Patra interest rate is 6.9%, and the Sukanya Samridhi Yojana interest rate is 7.6%. Five years Senior Citizens Savings scheme interest rate is 7.4%, and the FD rates at various banks are 5-6%.
The increase in G-sec yields puts pressure on the government to increase the small saving interest rates. Aditi Nayar, Chief Economist at ICRA, said the bond markets' nervousness could come down if the small saving scheme interest rates are increased. She expects the 10-year G-Sec rates to rise to 7.75-7.8% in the upcoming quarter. Thus, one can expect the small saving scheme interest rates to be revised soon.
Conclusion
The increase in 10-year G-sec rates puts pressure on the government to increase the small saving scheme rates. As per the reports, these upward revisions might be done by the month-end. You can expect the small saving schemes to increase soon as per various reports and the analysis by top economists.
