What are negative real rates? Suppose you earn 4 per cent per annum on your savings in the bank. The inflation in the economy is 6 per cent. What value add has actually happened to your savings? You guessed it right. The value has eroded by 2 per cent. This is what a negative real rate is. The nominal interest rate, or the RBI policy rate, is at multi-year low of 4 per cent (even lower due to excessive liquidity). The inflation is inching
Negative real rates are here to stay. Where mutual funds are your best bet?
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