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Moving My House Fund To Get Indian Interest Rates.

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I bank with HSBC and I asked the following at my local branch.

Can I move my house fund presently earning peanuts in the UK to an HSBC Indian bank and take advantage of the Indian bank rate which was recently increased to 6%.

HSBC said this is possible and they will have an expert telephone me on Monday, but I was wondering if anyone here can give learned advice on this matter.

If it's easy, why don't British savers move their money to banks where the country's rates are much higher?

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I bank with HSBC and I asked the following at my local branch.

Can I move my house fund presently earning peanuts in the UK to an HSBC Indian bank and take advantage of the Indian bank rate which was recently increased to 6%.

HSBC said this is possible and they will have an expert telephone me on Monday, but I was wondering if anyone here can give learned advice on this matter.

If it's easy, why don't British savers move their money to banks where the country's rates are much higher?

I work with a couple of indian guys and asked the same question a while ago. Seemed an issue about being a resident having an indian passport and needing to make cash deposits and getting money back out. Not sure that was a HSBC branch though.

Will be very interested to find out the response.

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I bank with HSBC and I asked the following at my local branch.

Can I move my house fund presently earning peanuts in the UK to an HSBC Indian bank and take advantage of the Indian bank rate which was recently increased to 6%.

HSBC said this is possible and they will have an expert telephone me on Monday, but I was wondering if anyone here can give learned advice on this matter.

If it's easy, why don't British savers move their money to banks where the country's rates are much higher?

currency risk, but of course you take that just holding £ sterling too

you have to ask yourself WHY indian IRs are high, I don't know myself

if you want high international income rates - why not simply invest in an developing markets bond fund instead (to spread a bit beyond india)?

thing is - according to an article in the economist in the last 6 months, lots and lots of westerners are doing the same and not necessarily discriminating

additionally see: http://www.thisismon...&in_page_id=166

Edited by Si1

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you have to ask yourself WHY indian IRs are high, I don't know myself

Indian inflation is very and real rates, even at 6%, are negative as far as I know.

A word on caution on capital controls. I couldn't tell how likely it is or what aggravation it would cause but apparently a number of EM countries are considering using capital controls to limit capital inflows.

Capital control could push the concerned currencies down if they are designed to limit capital inflows.

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Indian inflation is very and real rates, even at 6%, are negative as far as I know.

A word on caution on capital controls. I couldn't tell how likely it is or what aggravation it would cause but apparently a number of EM countries are considering using capital controls to limit capital inflows.

Capital control could push the concerned currencies down if they are designed to limit capital inflows.

+ 1

http://www.google.co.uk/search?um=1&hl=en&safe=off&rlz=1B3GGGL_enGB259GB260&biw=800&bih=418&q=inflation+india&ie=UTF-8&sa=N&tab=iw#sclient=psy&num=10&hl=en&safe=off&rlz=1B3GGGL_enGB259GB260&biw=800&bih=418&source=hp&q=inflation+India&aq=f&aqi=&aql=&oq=inflation+india&gs_rfai=&pbx=1&fp=818a8bd2053ae4a6

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currency risk (...)

Exactly. "picking up pennies in front of a steamroller"

but of course you take that just holding £ sterling too

you have to ask yourself WHY indian IRs are high, I don't know myself

if you want high international income rates - why not simply invest in an developing markets bond fund instead (to spread a bit beyond india)?

+ 1

Diversification is always the safest strategy.

.

Edited by Tired of Waiting

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I bank with HSBC and I asked the following at my local branch.

Can I move my house fund presently earning peanuts in the UK to an HSBC Indian bank and take advantage of the Indian bank rate which was recently increased to 6%.

HSBC said this is possible and they will have an expert telephone me on Monday, but I was wondering if anyone here can give learned advice on this matter.

If it's easy, why don't British savers move their money to banks where the country's rates are much higher?

HSBC do a multi-currency account, they offer local rates (ish I suppose), don't know the exact scope of currencies available though, need minimum deposits in each currency held as well.

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I bank with HSBC and I asked the following at my local branch.

Can I move my house fund presently earning peanuts in the UK to an HSBC Indian bank and take advantage of the Indian bank rate which was recently increased to 6%.

HSBC said this is possible and they will have an expert telephone me on Monday, but I was wondering if anyone here can give learned advice on this matter.

If it's easy, why don't British savers move their money to banks where the country's rates are much higher?

It is the currency risk that puts people off moving their money and after what happened to savers who put money into the Icelandic banks I do not blame them.

Let suppose you move £100k to an Australia bank at exchange rate of $1.7 to the pound.

You now have $170k with the prospect of earning good interest

What if 3 or 9 months time china slows down dramatically affecting Australia and the exchange rate goes back to say $2.0 to the pound. (2.4 is unlikely but not impossible with the level of debt the U.K has).

Now $170k divide by 2 is equal to £85k a loss of £15k

Or $170k divide by 2.4 equal to £71k a loss of £29k

If the exchange rate was closer to the normal range $2.2 – $2.6 then I would consider moving money into the Australian dollar.

Also you would need to be an Australian resident or have an Australian work visas.

disclamer

This is just my opinion.

Do your own research before investing your hard earned money.

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You don't need to be a resident, HSBC offshore allow you to put your savings in different currencies. Only currency hsbc does with a high interest is the AUD though.

I think barclays have also started doing the same thing.

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I just got an email from ICICI Bank to say the new interest rate is 0.8% (was 1%, used to be loadsa percent). Channelnews Asia says Indian central bank rate has just been increased by half percent to 6% on concern over inflation which has recently fallen to 8.51% from 9.78%. I guess the exchange rate is the critical thing, so all you have to do is predict the Rupee/Pound exchange rate. Let us know how you get on.

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  • 259 Brexit, House prices and Summer 2020

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