What is carry

Carry is the interest rate earned by going long a high-yielding currency and short a low-yielding one. For an ordered pair BASE/QUOTE, current carry equals the policy rate on the base minus the policy rate on the quote. Positive carry pays the long position a yield differential each year that the position is held.

This page ranks all 72 ordered pairs across the nine central banks we cover (9 base x 8 quote). Both the current carry and the forward 12-month carry — implied by each bank’s market-pricing rate path — are shown so you can see which pairs are pricing in carry compression.

How to use the ranking

• Top of ranking: largest positive carry today. These are the structural carry trades. Watch for pairs where the forward carry contracts sharply versus the current carry — that signals the market expects the higher-yielding bank to ease faster than the lower-yielding peer.
• Bottom of ranking: largest negative carry. Going long the base in these pairs requires paying yield. The mirror image (long quote, short base) is the carry trade.
• Carry change: positive change means widening carry, negative means narrowing. Narrowing carries are often the ones hedge funds exit first.

Risk caveats

Carry is the simplest piece of the FX return decomposition. It does not include:

• Spot FX moves, which can easily exceed 12 months of carry in a few weeks during stress
• Volatility, which scales risk-adjusted carry returns
• Funding costs, transaction costs, and credit risk in EM crosses
• Capital controls and convertibility risk for managed currencies

Use this ranking to identify candidates, then layer on volatility and macro screens before sizing positions. For each major pair, see the currency-pair deep dives for context on the underlying central bank dynamics.

Methodology

Forward carry is computed using each bank’s projected 12-month policy rate from the implied path. The implied path uses our standard CME-style probability tree. See the methodology page for details.

Top 12 carry pairs