MathishaGammanpila

FX Return Comparator

USD deposit or LKR deposit? The honest answer depends on one number: how fast the rupee moves. Compare both routes in rupee terms and find the exact depreciation rate where they break even.

Amount to invest

Horizon

years

Foreign return (e.g. USD FD)

%/yr

LKR alternative return

%/yr

Expected LKR depreciation

%/yr

Spot rate (optional, for FX amounts)

LKR/unit

Foreign route ends at

—

LKR route ends at

—

Foreign route in LKR terms

—

effective %/yr incl. FX

Breakeven depreciation

—

%/yr where both routes tie

Ending value vs depreciation assumption

Foreign-currency route (in LKR) LKR route (unaffected by FX)

Scenario table

Depreciation /yr	FX route (LKR)	LKR route	Difference	Winner

Notes

The identity behind this: effective LKR return of a foreign asset ≈ (1 + foreign return) × (1 + depreciation) − 1. Depreciation of the rupee helps the foreign route; appreciation hurts it.
Both routes assume annual compounding, interest reinvested, no withdrawals.
Taxes (e.g. WHT on interest, which can differ between LKR and FX deposits), fees and conversion spreads are not modelled — spreads on buying and selling FX can eat 1–2% on their own.
Historical depreciation is not a forecast. The whole point of the breakeven number is that you can form your own view against it.