“Achchedin” is reserved for fixed depositors. Everybody is watching the RBI MPC meeting!

RBI: A few more years will pass before fixed depositors’ savings in banks run out. Since the Reserve Bank of India (RBI) has issued important directives about interest rate changes, analysts anticipate that higher interest rates will persist. All eyes are now focused on the June 7–end RBI MPC meeting.

RBI: According to banking insiders, fixed depositors will benefit for a few more years still. It is disclosed that for the foreseeable future, banks will offer the highest possible interest rates. The reason for this is that the Reserve Bank of India has recommended that the key policy rates be left constant this time around.

The Monetary Policy Committee’s decisions will be made public by Reserve Bank of India Governor Shaktikatha Das on Friday, June 7, 2024. The monetary committee is probably in favour of maintaining the repo rate, which is the primary policy rate, unchanged at this meeting. But the question facing everyone at this point is: How long will these maximum interest rates last? Additionally, the question of what kind of approach to use for both short- and long-term investments has begun.

Due to better-than-expected economic performance despite pressure in certain economic sectors, the central bank is anticipated to maintain the repo rate at 6.6% for a seventh consecutive session. Banking analysts claim that the RBI’s decision to maintain the MPC interest rates at current levels is motivated by the country’s 8% GDP growth, inflation that is over target, and the ongoing uncertainty surrounding the US Federal Reserve.

Will FD interest rates stay high? How are FD interest rates impacted by the repo rate?

One of the key elements influencing deposit interest rates is the repo rate. Deposit rates will be constant if the RBI keeps them at their current levels. The FD investors won’t be impacted by this. Investors will benefit from higher interest rates as a result for a few more months. Experts, however, assert that long-term fixed deposits currently offer superior returns for investors. Interest rates are anticipated to be higher for maturities longer than five years. It is stated that because of the current interest rates, investors in foreign direct investment (FDI) will benefit greatly even if interest rates eventually decline.

Find the bank offering the best interest rates before making fixed deposits, and put money there to earn healthy returns. Up to Rs. 5 lakh in insurance coverage is available through the Depository Insurance Credit Guarantee Scheme.