net interest rate differential

Definition

The difference in the interest rate linked to two different currencies of two countries. For example, if an investor trades in dollars and saves in a US bank earning a 10% interest, but happens to take out a loan from a UK bank dominated in pounds for an interest of 7%, then the investor can cash in on the net interest rate differential of 3% profit by placing the loan taken from a UK bank into his US bank account.
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net interest margin securities (NIMS) net interest spread