How does raising interest rates control inflation? | The Economist

When central banks raise interest rates, the impact is felt far and wide. Mortgages become more expensive, house prices might fall and unemployment can rise. So why do central banks do it? This film tells you why.

00:00 – Why should you care about rising interest rates?
00:45 – What are interest rates?
01:36 – What do central banks do?
02:14 – Why do central banks raise interest rates?
03:12 – How do raised interest rates affect consumers?
04:30 – How do raised interest rates affect businesses?
05:20 – What are the risks of raising interest rates?
06:05 – How do interest rates affect inflation?

Sign up to our weekly finance newsletter to keep up to date:

Watch our video on whether higher inflation is a cause for concern:

Listen to our podcast on whether interest rates will trigger a recession in America:

Why interest rates may rise sharply to fight inflation:

Which housing markets are most at risk?

Is Turkish President Erdogan’s monetary policy as mad as it seems?

Why are investors worried about recession in America?

Do the poor face higher inflation?

Has the Federal Reserve made a mistake on inflation?

Leave a Reply

Your email address will not be published.