Raising interest rates are a pain for new loan seekers and those who are paying home loans ( variable interest schemes). But for those who are thriving on interest income, interest rate increase is a good news.
10% interest is offered by many banks on specified time periods.( 0.5% extra for senior citizens). Although the interest rate is lesser than the inflation rates, it atleast bridges the gap between inflation and returns.
With a very volatile stock market and immediate future of economy not auguring so positive, FDs would definitely come back into the portfolio of the middle class investors.
( TDS would be made if your interest earned per branch, per bank, per financial year exceeds Rs10,000 per annum. Appropriate forms need to be submitted at your branch to avoid TDS, if your overall income is below the taxable limit )