India

Cheer Up! Fixed Deposit Rates May Rise As RBI Aims To Restore CRR

By
OB Bureau

New Delhi: After a year of gloom and downward trend, the interest rate on bank fixed deposits may go up from April as the Reserve Bank of India (RBI) announced the restoration of the Cash Reserve Ratio (CRR) of banks.

In its first monetary policy of 2021, the central bank said that the CRR restoration will be effected in two phases, beginning next month.

RBI Governor Shaktikanta Das said on Friday that CRR will be changed to 3.5% from March 27, 2021, and then to 4% from May 22, 2021. The repo rate, however, was retained at 4%.

It may be noted that CRR was maintained at a 4% level from February 2013 to January 2020. It was reduced after the pandemic set in, leading to a significant fall in bank interest rates.

It may be noted that the RBI had maintained CRR at a 4% level from February 2013 to January 2020 before reducing it by 100 basis points to 3% in 2020, due to the disruption caused by the COVID-19 pandemic.

The central bank has indicated that liquidity may be injected into the system post-restoration of CRR if required.

“CRR normalisation opens up space for a variety of market operations of the RBI to inject additional liquidity,” Das said.

An increase in the interest rate of fixed deposits will be on the cards, but loan rates — including home loans – could go up.

Also Read: RBI Keeps Repo Rate Unchanged After Two Consecutive Cuts

OB Bureau

Recent Posts

Baba Siddique Murder Accused Used Mobile Hotspot To Evade Arrest, Here’s How

Mumbai: The Mumbai Police crime branch revealed that an accused in the Baba Siddiqui murder…

November 22, 2024

Kashika Misra Wins Golf Championship; Know About Her Odisha Roots

Bhubaneswar: Kashika Misra has created history by becoming the first Odia girl to win any…

November 22, 2024

Moscow Entitled To Strike Military Targets Of Countries That Allow Ukraine To Use Weapons…: Putin’s Warning To ‘West’

Moscow: President Vladimir Putin has warned the countries that allow Ukraine to use their weapons…

November 22, 2024

4 Held From Gujarat 5 Months After Duping Elderly Odisha Couple Of Rs 34L In ‘Digital Arrest’

Bhubaneswar: After a five-month-long investigation, Jharsuguda police in Odisha busted an inter-state cybercrime racket and…

November 22, 2024

Vedanta Expands Its ‘Swarna Prashan’ Drive In Odisha’s Rayagada & Kalahandi

Bhubaneswar: Vedanta Aluminium has expanded its ‘Swarna Prashan’ initiative, an Ayurveda-based immunisation drive, to over…

November 22, 2024

Justin Trudeau Govt Denies Linking PM Modi, Jaishankar & Ajit Doval To Criminal Activities In Canada

Ottawa: The government in Canada, led by Justin Trudeau, on Friday denied linking Prime Minister…

November 22, 2024

Two Sisters Consume Poison In Odisha’s Boudh, One Dead

Bhubaneswar: A woman died while her younger sister is battling for life after an alleged…

November 22, 2024

Achyuta Samanta Conferred Lifetime Achievement Award At 43rd World Congress Of Poets

Madurai: Founder of KIIT, KISS, and KIMS, Achyuta Samanta has been honoured with Lifetime Achievement…

November 22, 2024