I come from a country that 15 years ago was liberated by war. I also belong to banking sector. Even after the war, and with a fragile banking sector, highest term deposit yield was 6.6% and currently are around 1.5%.
Banks increase interest to attract investors, and lower them if there is no need for new funds. It's a free market. I don't know which bank, or which country, but I smell trouble.
Sometimes for some investors high bond yields are very compelling to invest. But unfortunately, higher yields also means higher risks. Countries that pay high yields means they are having difficulties on finding investors to buy their bonds. There are a lot of risks involved, but in Russian case the risks are clear. It's all about current geo-political uncertainties. Lets compare some different 1 year bonds high to low: (real data from investing.com
Ukraine 20% Uganda 11.40% Turkey 9.05% Russia 8.52% .... United Kingdom 0.55% Switzerland 0.05% United States 0.09% France -0.03% Germany -0.08%
By comparing the table above the investors are requesting Ukraine 20% for their money, from Russia 8.52% while they will pay Germany 0.08% to keep their money. Interest rates are linked to risks, and investors often are ready to pay someone just to keep their money safe (France and Germany on this case).
On the long run, if yields remain high it will become a burden to the country. A lot of tax payer money will go to paying interest. High yields will lead to deflation (the country will be forced to print more money) or even bankruptcy. It was not a long time ago since last Russian bankruptcy, only 15 years ago.
Of course it is not safe to buy Russian bonds. As a matter of fact, there is no safe bet. It's just different levels of risks. There is a golden rule to investing: 'If you want to make money you have to take risks'.
AVERTISSEMENT SUR LE RISQUE ÉLEVÉ : Le trading de devises comporte un niveau de risque élevé qui peut ne pas convenir à tous les investisseurs.
Leffet de levier crée un risque supplémentaire et une exposition aux pertes. Avant de décider de négocier des devises, examinez attentivement vos objectifs dinvestissement, votre niveau dexpérience et votre tolérance au risque.
Vous pourriez perdre une partie ou la totalité de votre investissement initial. Ninvestissez pas largent que vous ne pouvez pas vous permettre de perdre. Renseignez-vous sur les risques associés au trading de devises et demandez conseil à un conseiller financier ou fiscal indépendant si vous avez des questions.
Toutes les données et informations sont fournies "en létat", uniquement à titre dinformation, et ne sont pas destinées à des fins de trading ou de recommandation.
Les performances passées ne sont pas indicatives des résultats futurs.