Fixed Deposit Accounts In Nzd, Opportunity ?

[cclub75]

I plan to open 1 or 2 foreign currency fixed deposit accounts in Singapore.

Starting to look around, I was very surprised by the rate with New Zealand dollar. More than 6 % !

This is actually a strange country... To keep inflation between 1 and 3 %, the Central bank has such a rate...

And of course the currency has gained against Euro.

So why not buy NZD from EUR, and open a fixed deposit, let's say for 6 months ? And enjoy a good return. There is little risk that the Central bank would cut its rate with an axe, and that the currency would crash in such a little period of time.

What do you think ?

[Sophon]

Personaly I have no expertise or opinion on this, but the bank I use in it's latest currency analysis called the NZD "an accident wating to happen".

Sophon

[The_Moog]

Your strategy looks okay to me.

Go for it.

Little downside with that currency play.

In high yield currencies, I like Sterling, NZ$, and at current levels, even the Indo Rupiah looks nice and fat.

[muldoon]

one of our CDs in NZL is currently getting 8.8% for a 12 month term.

[dr_Pat_Pong]

And the beauty of Singapore is no tax on interest for non residents

[Riley'sLife]

6.6% is available for 30 day Term Deposits, which seems more sensible than committing to 12 months. A lot can happen to a currency in 12 months and a return of even 10% achieved on CD will look pretty sick if (or rather when) the NZ$ returns to its historic level. Dealers use the NZ dollar as a safe haven, and they have more invested in NZ than the NZ gov have in reserves, so beware.

Good luck. Rick

[thohts]

6.6% is available for 30 day Term Deposits, which seems more sensible than committing to 12 months. A lot can happen to a currency in 12 months and a return of even 10% achieved on CD will look pretty sick if (or rather when) the NZ$ returns to its historic level. Dealers use the NZ dollar as a safe haven, and they have more invested in NZ than the NZ gov have in reserves, so beware.

Good luck. Rick

<{POST_SNAPBACK}>

I think that's 6.6% annual percentage yield, not for the month.