| Experts believe the interest rate for the Central Provident Fund (CPF) Ordinary Account (OA) could be tweaked in the light of rising interest rates in the United States. One option raised at a forum yesterday was to include the returns of the sovereign wealth fund GIC when devising the formula that determines the OA rate.
Interest on OA funds is adjusted quarterly. It is either the legislated minimum 2.5 per cent a year or the average three-month rates at the three local banks, whichever is higher. GIC publishes five-, 10- and 20- year returns for all its investments of government assets, including CPF funds. The annualised 20-year real rate of return for the year ended March 31, 2014, was 4.1 per cent...............................................Full Article: Source
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