As FD rates moderate, investment in bonds emerge as the next destination for fixed-income investors for wealth creation

Fixed deposit rates have declined from around 8.5% in 2015 to about 6.9% currently, encouraging fixed-income investors to diversify into government securities, state development loans, and corporate bonds. Debt mutual fund assets under management have risen nearly 35% over the past three years to Rs 18.25 lakh crore, with SEBI reducing the minimum listed bond investment size to Rs 10,000 to improve retail access. The RBI repo rate stands at 5.25% following an easing cycle, making AAA-rated PSU and corporate bonds more attractive for investors seeking better yields with comparable risk.