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Currency with the biggest interest to inflation gap?

Discussion in 'General Business' started by Cyrus255, Mar 25, 2019.

  1. #1
    Hi all,

    I noticed a pattern, the countries with the highest inflation tend to have high interest rates.
    SEMrush
    Anyone know of a country where inflation is significantly higher than the interest rate? And which isn't on the African continent?

    I know Venezuela is probably a clear answer but they do not have banks I can get a loan from nor would I feel safe traveling there for one. Argentina looked great with 47% inflation but the best interest rate I could see from a bank was 50% so it still outpaced inflation.
     
    Last edited: Mar 25, 2019
    Cyrus255, Mar 25, 2019 IP
    SEMrush
  2. Spoiltdiva

    Spoiltdiva Prominent Member

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    #2
    Your best bet would be Switzerland. They have easily the lowest interest rates in the world with a very stable economy where inflation is low and controlled.
     
    Spoiltdiva, Mar 25, 2019 IP
  3. Cyrus255

    Cyrus255 Well-Known Member

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    #3
    No, that is the WORST country in the world for a loan because their currency will appreciate and thus the loan will become heavier, like what happened to many Poles who took out loans from the Swiss and then the Swiss franc gained like 20% in value against their currency so it's like the loan grew 20%.

    What would be better is if I'd taken an Argentine loan last year, it was 1 USD for 20 argentine pesos, now it's 1 usd for 40 argentine pesos in a 12 month span, basically you can pay back a $200,000 2018 equivalent loan (which you used to buy something of real value) with $100,000 in 2019 dollars. The problem is their interest rate is so high it would cancel out those gains.

    My question is if there is any country which doesn't have interest rates as high or matching their inflation. Venezuela is the only one that is a clear example (25% interest but 80,000% inflation) but kind of dangerous to get a loan from them...
     
    Cyrus255, Mar 25, 2019 IP
  4. Spoiltdiva

    Spoiltdiva Prominent Member

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    #4
    Clearly you do not know what you are talking about. The Swiss interest rate has averaged 0.76% from the years 2000-2019. It is low and stable and I cannot comprehend what you are on about. The Swiss currency in regards to Forex trading for example.......oh never mind, why should I even bother? Over and out.......Bon seigneur, certaines personnes!

    P.S. if you are borrowing and paying the Swiss loan with a currency from an unstable country then yes, problems. But I would presume that one would be using American dollars in this case.
     
    Last edited: Mar 25, 2019
    Spoiltdiva, Mar 25, 2019 IP
  5. dejaone

    dejaone Well-Known Member

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    #5
    You don't need to get loan, just trade currency. It's economy ABC that central bank will raise rate to fight higher inflation. You won't make money from this pattern.
     
    dejaone, Mar 31, 2019 IP
    Mehta likes this.
  6. snakeplissken

    snakeplissken Active Member

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    #6
    Nobody will make you a loan in local currency in countries with high inflation. What you want to do is an old gimmick and never worked because those who have enough capital in hyperinflationary currency do not lend it as such but convert it asap in a more stable currency like the USD to make sure it preserves its value.
     
    snakeplissken, Apr 2, 2019 IP
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  7. NetStar

    NetStar Notable Member

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    #7
    Next he's going to purchase an email list of 100k to market to, hang out in AOL chat room and advertise his angelfire website where he has keywords stuffed on the bottom of the page with the same color text as his background.
     
    NetStar, Apr 21, 2019 IP
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