Savings & Interest
Idle cash in a savings account earns interest every turn. There is no feature flag: savings interest is always on. The rate is tied to the central bank's prime rate, accrues continuously, and credits to your balance on a quarterly schedule.
The rate#
The annual percentage yield (APY) paid on savings is half the real rate: the prime rate minus local inflation, not the prime rate on its own.
realRate = max(0.5, primeRate - inflation)
APY = realRate / 2
So a 4.42% prime rate does not pay 2.21% APY unless inflation is zero. With 2% inflation the real rate is 2.42% and the APY is 1.21%.
| Prime rate | Inflation | Real rate | Savings APY |
|---|---|---|---|
| 4.0% | 0.0% | 4.0% | 2.0% |
| 4.0% | 2.0% | 2.0% | 1.0% |
| 8.0% | 6.0% | 2.0% | 1.0% |
| 14.0% | 13.8% | 0.5% (floor) | 0.25% |
Using the real rate is what closes the carry trade. A currency with a high nominal prime rate normally also has high inflation, so its real spread, and therefore its savings APY, lands near everyone else's. Parking money in a high-nominal-rate currency earns no free real return.
The real rate never falls below a 0.5 percentage point floor, so every currency pays at least 0.25% APY. The floor is the same everywhere, so it gives no currency an edge.
When the Central Bank Chair raises rates, your savings yield rises with them, but only to the extent the rise beats inflation.
Per-turn accrual#
Interest accrues every turn but is only credited quarterly (every 12 turns, i.e. TURNS_PER_YEAR / 4). The per-turn accrual is:
perTurnAccrual = balance × (APY / 100) / TURNS_PER_YEAR
With 48 turns per year and a real rate of 4% (APY 2%):
perTurnAccrual = balance × 0.02 / 48 = balance × 0.0004167
A ¥1,000,000 balance accrues roughly ¥41.67 per turn, credited as a ¥500 lump every 12 turns.
Rounding#
Accruals are rounded to the currency's native precision:
| Currency family | Rounding |
|---|---|
| JPY (and other 0-decimal currencies) | Whole units |
| All other currencies | 2 decimal places |
This keeps credited interest matching the ledger's expected precision: no fractional yen, no floating-point drift on dollar/euro balances.
Crediting schedule#
| Event | Cadence |
|---|---|
| Accrual computed | Every turn |
| Interest credited to balance | Every 12 turns (quarterly) |
Accrued-but-uncredited interest is tracked internally; if you close or move the account mid-quarter, the pending accrual is settled at that point so nothing is lost.
Practical notes#
- Rate-following: Because APY = real rate / 2, savings is sensitive to both policy rates and inflation. In a high-rate environment it is a genuine yield instrument; in a low-rate environment it barely beats stuffing cash under a mattress.
- No lock-up: Unlike bonds, savings can be withdrawn at any time. The cost of that liquidity is the half-real-rate haircut versus buying sovereign bonds directly.
- Compound effect: Credited interest becomes part of the balance for the next quarter's accrual, so savings compounds quarterly, not just per-turn.
- Whale cap: Only the lesser of your balance and 25% of the whole currency's national savings pool earns interest. This closes a carry-trade loophole where a single huge account could farm interest on nearly 100% of a currency's savings; ordinary balances well under a quarter of the pool are unaffected.
See also: Central Banks, Sovereign Bonds, Line of Credit, Currency Exchange