How to do with the low interest rate and exchange rate of NTD ?
The interest rate is around 2%.It is obviously lower than many countries.
It seems do the NTD fixed deposit is the last choice.
If we do the USD,Euro…those foreign currency fixed deposit.
Is it possible we get the higher interest rate but lose the exchange rate?
What should I have to notice?
I 'll appreciate the suggestions.
Ahhh… that is the dilemma facing anyone doing foreign exchange.
In theory, the interest rate difference should be offset by the change in the FX rates over the period.
Do a Google search on Uncovered Interest Rate Parity.
However, obviously due to changes in market conditions, unexpected announcements/events etc, this is not always the case. So basically if you want to make a profit, you will still need to make certain judgments and predictions. Things like whether the central banks will raise/lower interest rates, the growth and health of the economies (and of other countries that affect it), government political risk etc.
So there is still an element of risk as predicting these variables is no easy job.
Hope that sets you off in the right direction.
[quote=“wisher”]How to do with the low interest rate and exchange rate of NTD ?
The interest rate is around 2%.It is obviously lower than many countries.
It seems do the NTD fixed deposit is the last choice.
If we do the USD,Euro…those foreign currency fixed deposit.
Is it possible we get the higher interest rate but lose the exchange rate?
What should I have to notice?
I 'll appreciate the suggestions.
[/quote]
Still relatively bad, but the rate has gotten a little better in the past few weeks for those hoping to cash in their NT$ for USD, and I’d bet it will continue to get a little better.
And, if your alternative is to leave your money in a Taiwan CD or the like for at least a year, I’d think you would do better – despite the fairly bad exchange rate – to buy USD and put it in a USD CD.
If you have at least US$10k to invest, you can get 5.4% at Countrywide Finance for a one year CD.
Here is a list of other leading CD rates. Most can be applied for online and the funds wire transfered from Taiwan.
Hmm… I get 5.something % from 6 month GBP deposits at CitiBank. I don’t think it’s necessarily worth dealing with offshore banks for cash deposits unless you have some connection with that country and/or already have an account.
It does look good to be earning those 5+% interest… but one uncertainty you will face in the very near future is the possibility of the Taiwan Central Bank raising interest rates which will appreciate the TWD, thus reducing the profits from foreign deposits.
They have been showing signs of an interest rate hike by increasing the overnight interbank rate and manipulation of long term forward rates.
Main reason for this is to slow down the liquidity of cash in the Taiwan economy and to stop people doing carry trade (borrow cheap TWD to invest in higher yielding currencies), similar to what’s happening with Japanese Yen lately.
Though at the moment, I’d place my bets on NZD as their interest rates are 8% and their currency has a very strong upward pressure. It’s at its highest point in history (22 years since floating) and the Royal Bank of NZ has had to intervene last week to push it back down a bit. But the pressure up will still be very strong since their interest rates are so high, attracting carry trade from all over the world. One year fixed NZD deposit is looking quite tasty.
I’m by no means an expert, just an unimportant finance student. Continue at your own risk 
Thanks all.
I orginally had GBP account and get 4.1% interest.
But it was the exchange rate last year about 61.9-62.5NTD to 1 GBP.
Now it is 64-65NTD to 1 GBP,I don’t know if I should keep invest in GBP.
New Zealand has reaised their interest rate again.
And some banks offer the interest 8+% here,but the exchange rate is higher than ever.
Taiwan central bank may raise interest rate again .
It tried to raise the interest rate and exchange rate,didn’t it?
But NTD to USD is still around 33NTD to 1USD.
But I prefer to know more about USD and NZD in this area.
How about the EUR?Anyone invest EUR?
the interest rate is even higher now, is it going to keep on going up or they gonna lower the interest rate? I am going to borrow some money against my house…anyone?
also when I take a loan against my house in Taiwan, what fees/charges do they charge that I need to be aware of??
[quote]the interest rate is even higher now, is it going to keep on going up or they gonna lower the interest rate? I am going to borrow some money against my house…anyone?
[/quote]
news1.pchome.com.tw/politics/mer … 21251.html
It was news of 21th of Sept .
You can check it out.
NTD to US dollar was up this Tuesday.
Which will be better to buy for now ?US dollar , GBP,EUR or others?
[quote=“wisher”]NTD to US dollar was up this Tuesday.
Which will be better to buy for now ?US dollar , GBP,EUR or others?[/quote]
definitely not USD, it’s getting so weak and and it’s keep on going weaker. GBP, EUR are good choices