Now Reading: RBI sets SGB 2019-20 Series III redemption price at Rs 15,310
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RBI sets SGB 2019-20 Series III redemption price at Rs 15,310
The Reserve Bank of India (RBI) has announced that the premature redemption price for the Sovereign Gold Bond (SGB) 2019-20 Series III will be Rs 15,310 per unit. The redemption is due…
The Story in Brief
The Reserve Bank of India (RBI) has announced that the premature redemption price for the Sovereign Gold Bond (SGB) 2019-20 Series III will be Rs 15,310 per unit. The redemption is due on August 14, 2026, which marks the completion of five years from the issue date of August 14, 2019.
The price is based on the simple average of closing gold prices of 999 purity for the three business days before redemption (August 11, 13, 2026), as published by the India Bullion and Jewellers Association (IBJA). Investors can redeem their bonds on this date, the next interest payment date after five years.
The Indian Opinion
Some investors may grumble that the Rs 15,310 price is lower than the spot gold rate on the redemption date. But the three-day average formula was disclosed when the bond was issued, there is no surprise. SGBs offer a fixed interest plus potential capital gain, and premature redemption is a facility, not an obligation. The real test will be how this average compares with the final maturity price in August 2027.
Source: rbi.org.in
This story was synthesised by AI from the source linked above.
