With rising interest rates, fixed deposit (FD) is trending once again.
There are two main types of fixed deposit – foreign currency fixed deposit and Singapore dollar (SGD) fixed deposit.
For SGD fixed deposit, the best fixed deposit rate you can get from the local banks is at 3.90% from UOB.
For foreign currency fixed deposit, the best rate is 4.55% from DBS foreign currency fixed deposit.
Now, you might be thinking to put your money into the latter since it offers a higher interest rate.
This may not necessarily be the case. Read on to find out more!
How does a foreign currency fixed deposit work?
Source: DBS
Foreign currency fixed deposit works the same way as your usual SGD fixed deposit, except that your funds are held in foreign currency such as USD, GBP, HKD etc.
You have to put in funds in a foreign currency with the bank and you will earn interest rates in that particular foreign currency....