Interest rates- will they peaks soon?

For a long time the RBI has been increasing interest rates because of high inflation, with the hope of getting inflation under control.

With increasing interest , the rates of fixed deposits have also been consistently increasing.

The question is that has the interest rate cycle peaked? Why is that important?

Well, if one is someone is looking to lock in their investment with these high rates, then it is critical that they follow the movement of the RBI.

In my opinion the RBI is not going to lossen it's purses anytime soon. There is no sign of inflation coming under control
With the recent hike in diesel prices, it is only headed north.

So what should we do to lock in our fd. Should we wait ?

Well it depends on how much higher the rates could go. Remember if you don't invest you will only get savings account interest rates @. 3%

So what should we do? Keep investing by using the laddering concept.

Invest for shorter terms and not for long terms like 2-5 years.

This will help you get the best of interest when they reach the peak.

I hope the peak is soon . Else the impact to the India growth story is going to be very negative.

Happy investing.

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