Understanding the 'Carry' in Forex: Why Some Pairs Look Tempting

Hey everyone, been diving into more advanced forex concepts lately and wanted to share a quick thought on 'carry trade' since it’s often mentioned but sometimes vaguely defined. Basically, a carry trade is when you borrow a currency with a low interest rate and use it to buy a currency with a higher interest rate, pocketing the difference. Think of it as earning interest on your position. The catch, of course, is currency fluctuation. If the higher-yielding currency weakens significantly against the lower-yielding one, your gains from the interest differential can be wiped out, or even turn into a loss. It’s why you'll hear about $USDZAR or even $USDCAD potentially being used in carry strategies, though the latter less so these days with narrowing rate differentials. The allure is steady income, but the risk of capital depreciation is real if volatility spikes. Anyone here actively incorporating carry into their strategy, or is it more of a macro play you observe?