Households could get some relief this week as economists expect the government to raise the interest rates paid on small savings schemes for the July to September 2022 quarter, with the yields on government securities hitting a four-year high of 7.6% earlier this month.
The rates of interest on instruments such as the Public Provident Fund (PPF) and the National Savings Certificate (NSC), currently at 7.1% and 6.8%, respectively, have not been changed for eight quarters since a reduction was effected in the first quarter of 2020-21.
Retail inflation too had hovered above 7% in April and May, squeezing household budgets. Raising rates on small savings could also help the government reduce its reliance on market borrowings this year.
