The yields on several debt papers have hardened as the central bank increased interest rates.
The mutual fund (MF) industry’s exposure to bank certificates of deposit (CDs) has surged nearly fourfold since October, from just Rs 48,576 crore to Rs 1.76 trillion at the end of last month.
Industry players say banks have ramped up mobilisation via CDs in recent months amid pick-up in credit offtake.
Expectations of lower deposit growth and increased credit costs amid inflationary pressures have also driven banks to issue CDs over the past few months.
First Published: May 22 2022 | 11:11 PM IST