It has been some time since my brother and I started our AUD & NZD fixed deposits, more specifically we are just one quarter short of 3 years.Despite being hit by the financial crisis worldwide interest rate cuts, the interest rates have stabilised at around 4% and 2% respectively (source: OCBC 3-mth tenure rates). Although these are not fantastic returns, AUD and NZD remain the highest-yielding foreign currencies.
The main risk for foreign currency investment of course is that the exchange rate with your home currency becomes unfavourable for changing back (i.e. the worst case scenario will be that the home currency strengthens so much that the interest does not even cover back the shortfall, giving an overall loss of capital).
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