Risk averse investors may switch to short term debt funds
Debt mutual fund investors face credit risk, liquidity risk and interest rate risk in their portfolio. The first two have gone into the backburner for now.
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Debt mutual fund investors face credit risk, liquidity risk and interest rate risk in their portfolio. The first two have gone into the backburner for now.
The Monetary Policy Committee decided to stick to the objective of reviving growth over reacting to inflation as its approach is to gradually tackle the prospects of impacting output rather than a `sledge hammer' approach that would kill the nascent recovery.
The lockdowns this time around did allow more economic activity and were of shorter periods compared with last time when the duration was very long.
RBI has kept the yield on the 10-year on a tight leash in view of the large Government borrowing programme amid the pandemic
The weakness in growth amidst Covid-led lockdowns prompted MPC to acknowledge that the current situation warranted “policy support from all sides – fiscal, monetary and sectoral”.