If you have the USD in the bank do you pay interest? Do you know any bank that is charging interest for savings? That is what I am looking for.
Because you are asking stupid questions. You can't buy a currency without selling another currency. Secondly, you short the usd to buy the yuan and you will earn interest because usd is 5.25 china is 6.39, India is 7.5. So you will be earning interest on the trade. Man do some research.
I don't feel that there's anyhing stupid about the OP's questions. I know highly intelligent people, top school MBA grads, who don't seem to understand the inevitable pairwise nature of currencies as an asset class. The answer 2 posts above this one is wrong, BTW. Those aren't the rates, especially on CNY and there's more involved; as often the case, the devil's in the details. You are forgetting that Oanda also pays interest on your entire USD account balance, regardless of open positions, if any. Go over here and play with position sizes, time periods and leverage. The relevant rates are: USD account balance +4.925% Sell (short) USD/INR -5.475% + 7.75% = +2.275% per each 1:1 unit of leverage Sell (short) USD/CNY -5.475% - 0.5% = -5.975% per each 1:1 unit of leverage At 1:1 leverage, the interest charged on the USD short (-5.475%) is nearly, but not quite, offset by the interest paid on the account balance (+4.925%), for a net cost of 0.55%. At 25:1 leverage (the maximum available), the IRD (interest rate differential) component dominates the interest on the account balance component. You are thinking something like opening an account denominated in INR or CNY, right? Besides being, um, a tiny bit inconvenient if you are located outside those countries, consider this: you'd still have to withdraw money from, say, your USD bank account, to open such an account. Thus, you'd have to forego future interest on that USD account, in exchange for earning local currency interest. See how that's functionally equivalent to the above, more conventional method? An online dealer like Oanda makes jumping through those account-opening and access hoops unnecessary, while effectively charging you 0.55% for the privilege (the difference between USD lend and borrow rates). Moreover, unlike a INR or CNY bank account, you've got access to 25:1 leverage. What bank will let you short 2,500,000 USD/INR on a $100K account, for an annual interest-only return of $61,800, or 61.8%? Of course, that's before any cap. gains or losses, which could be far greater than that.
If it's interest you want, and you want to short the dollar against some "third world" currency with high interest at Oanda, short the hell out of USD/TRY.