Dear readers, looking at the title of the post, you may be wondering what am I talking about? Interest rates have started to come down and what higher interest rates that continue to be of interest am I talking about?
Interest rates have come down including:
BS24120V 6-Month T-bill (latest T-bill which closed): offered 3.06% per annum
Singapore Saving Bonds: 2.56% per annum (average 10-year interest rate) for the SBNOV24 GX24110N bond which currently is open for application
As well as 2.60% to 2.70% per annum for fixed deposits held with OCBC and UOB.
Amidst the falling interest rates across the board, Chocolate Finance stood out as being one of the very few firms in town to still provide a decently high interest rates at 4.20% per annum! Read more about my sharing of Chocolate Finance.
READ MORE >>> My meal in Heap Seng Leong!
To clear the air, my higher interest rate is referenced to the baseline savings interest rates offered by Singapore banks.
Higher interest rates be they offered via fixed deposits, Singapore Savings Bonds and Singapore T-bills will continue to be of interest to savers because of the fact that while interest rates have declined, we do not easily find the cost of our daily necessities go down any.
For example, my favorite chicken rice which has gone up to $5 a plate in recent years, I do not expect that I will pay anything lesser than $5 going forward even if interest rates have gone down. In gist, the $5 price has already been fixed and I do think that even if some food sellers can lower the price if there is easing in the cost of their ingredients, they may still continue to charge the same price and earn the profits: customers’ minds are already settled on the $5 meal. The chicken rice price can only go higher in future, at the next set of data showing even higher costs in the future.
With costs of daily necessities still staying the same, higher interest rates products should still appeal to savers who are risk averse to put their monies in equities.