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Interest Rates, US and Global Economies

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Explain two ways interest rates influence the U. S. and global financial environment. Provide one example of such influence for both the U. S. financial environment and one example for the global financial environment.

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Discusses how interest rates influence the U. S. and global financial environment. Over 200 words, with references provided to aid in understanding.

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Interest rate movements have a major impact on the US financial environment. For example, if interest rates are increased by Federal reserve in US, the disposable income in the hands of consumers will decline and they will start to cut their spending which, in turn, will negatively affect the businesses as well. Further, banks will also extend lesser loans as businesses will ...

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Sheetal Jain, PGDM
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  • BComm, University of Delhi
  • Post Graduate Diploma in Management (Equivalent to MBA), All India Management Association
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