RBI announces 7.03% interest rate on Floating Rate Bond 2024

The Reserve Bank of India (RBI) on May 6 announced an 7.03 percent interest on Government of India Floating Rate Bond 2024 (FRB 2024)
applicable for the half year May 07, 2024 to November 06, 2024.

"It may be recalled that the rate of interest on FRB 2024 is reset at the average rate (rounded off up to two decimal places) of the implicit yields, at the cut-off prices of the last three auctions of Government of India 182-days Treasury Bills, held up to the period preceding the coupon reset date, which is May 07, 2024," the RBI said in a press release.

Floating Rate Bonds are securities that do not have a fixed coupon rate. They have a variable coupon rate which is re-set at preannounced intervals.

The FRB bonds carry a coupon with a base rate equivalent to a weighted average yield of the last three auctions of 182-day Treasury Bills (T-Bill) plus a fixed spread decided by way of auction.