1
Question
Q. With reference to the Inflation-Indexed Bonds, consider the following statements:
Which of the statements given above is/are correct?
Q. With reference to the Inflation-Indexed Bonds, consider the following statements:
Which of the statements given above is/are correct?
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Solution
The correct option is A 1 only
Explanation:
Only statement 1 is correct
Inflation-Indexed Bonds help to hedge against inflation risk because they increase in value during inflationary periods.
Pursuant to the announcement made in the Union Budget for 2013-14 to introduce instruments that will protect savings of poor and middle classes from inflation and incentivize the household sector to save in financial instruments rather than buy gold, RBI, in consultation with the Government of India, decided to launch Inflation Indexed Bonds (IIBs).
Explanation:
Only statement 1 is correct
Inflation-Indexed Bonds help to hedge against inflation risk because they increase in value during inflationary periods.
Pursuant to the announcement made in the Union Budget for 2013-14 to introduce instruments that will protect savings of poor and middle classes from inflation and incentivize the household sector to save in financial instruments rather than buy gold, RBI, in consultation with the Government of India, decided to launch Inflation Indexed Bonds (IIBs).
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