New Delhi, Jan. 28 -- The Reserve Bank of India (RBI) has been on a rate-cutting cycle, squeezing fixed deposit returns and creating a dilemma for investors seeking consistent and assured income.

With the latest 25 basis point cut announced at the December policy meeting, the RBI has lowered the repo rate to 5.25% from 5.50%. In response, banks have steadily reduced fixed deposit rates. Currently, most large banks offer interest rates of 6.50%-7.00% on fixed deposits with tenures ranging from one to five years.

Over the past year, fixed deposit rates across banks have fallen by 1.00%-1.50%. Against this backdrop of declining yields, the Floating Rate Savings Bond, 2020 (Taxable) is offering an interest rate of 8.05% per annum-raising th...