InvestorQ : Are interest rates likely to be reduced by EPFO?
ishika Banerjee made post

Are interest rates likely to be reduced by EPFO?

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9 months ago
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It has been in the news that the Employee Provident Fund Organization is going to cut interest rates by around 15-25 basis points, resulting in lower returns for the workers’ investment. However, there has not been any specific announcement for the same yet, it will take place at the end of January after finalizing proceedings in the meeting. This reduction is possibly due to the economic slowdown and lower yields on other investments as well.

Growth is slow among the economy; hence reduced rates will help the government to keep pace with the economic factors. The 10-year benchmark government securities dropped by 85-90 basis points between January 2019 and January 2020 and that would weigh on EPFO earnings. If you listen to the experts, this reduction would not come as a surprise for the investors, the market has all the indicators for possible reduction.

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