Target maturity funds can help you avoid losses amid rising interest rates

Stick to shorter tenure fixed deposits now to benefit from higher rates later

The benchmark 10-year government security (G-Sec) yield rose sharply after the Budget was announced last week. It touched a peak of 6.95 per cent before retreating slightly to 6.88 per cent. With the low interest-rate environment prevailing since the onset of the pandemic likely to change, investors and borrowers need to be prepared to deal with the emerging scenario.  

Higher govt borrowing driving up yield

The key factor that drove the 10-year G-Sec yield up last week was the Budget ann­ouncement on government borrowings for financial year 2022-23 (FY23). “The market was expecting gross borrowing to be in the range