The interest rate, which was on a downward slope for a large part of the last three to four years, could find itself on sticky footing in 2018. Government securities (G-sec) yield has moved up by nearly 100 basis points over the last 12 months.
Bond price movements have deep rooted implications for fixed income investors, borrowers, and depositors. In the New Year, while borrowers looking for home and car loans may not have much to cheer about, investors who rely on fixed income products such as bank fixed deposits (FDs) can heave a sigh of relief. As for debt mutual fund investors, with bond yields showing a rise in the recent past, debt mutual fund investors need to be cautious in the coming months.
