carry trade

noun

1. finance a speculative transaction in which a trader buys the currency of a country with a high rate of interest and sells the currency of a country with a low rate of interest

Example Sentences

“And until that point, low volatility means the carry trade will stay popular—now with the yen as the preferred funding vehicle.”

Read more on The Wall Street Journal

The yen’s rapid decline, and the extremely low rates on Japanese government bonds, are likely to stoke what is known as the yen carry trade.

Read more on Barron's

A rapid unwinding of that carry trade, however, can cause havoc in global markets.

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"The largest overhang I can see in this regard is dollar-yen, where the BOJ must pivot regardless and the carry trade that has built up now amounts to nearly half a trillion dollars."

Read more on Reuters

"Friday's action might best be viewed as an attempt to head off a fresh wave of yen-weakening carry trade activity, by at least ceasing to resist pressure for 10-year yields to rise above 0.5%," said Ray Attrill, head of FX strategy at National Australia Bank.

Read more on Reuters