Short-Term Debt Funds Turn Attractive Post CRR Cut

A SURPRISE JUNE monetary policy outcome of the Reserve Bank of India (RBI) policy in which repo rate was cut by 100 basis points (bps) and 100 bps cut in the cash reserve ratio (CRR) is likely to improve short-to-mid-duration debt funds' returns, said experts.

- ANANYA GROVER

In total, since February repo rate has been cut by 100 bps.

Marzban Irani, CIO of fixed income at LIC Mutual Fund, recommends investing in tenures ranging from three months to three-year schemes to take advantage of the CRR cut. He added that the CRR cut has surprised the markets and is expected to release liquidity of ₹2.5 lakh crore.