You made a bank deposit in UK sterling that matures next December. The interest rate was 10% while home rates are only 4%. You thought you would be going to London at the end of the year, but now you cannot. The outlook for pounds is depreciation, but you will lose all of your interest if you break the deposit.
What can you do reduce your risk and what do you need to think about in deciding if you should?
Name three strategies to deal with this situation and tell which you think is best and why.
1 answer