Interest Rate Adjustments
Interest rate adjustments refer to changes made by central banks, like the Federal Reserve, to the interest rates that influence borrowing and lending in the economy. These adjustments can either increase or decrease rates, affecting how much consumers and businesses pay for loans or earn on savings.
When interest rates are lowered, borrowing becomes cheaper, encouraging spending and investment. Conversely, raising interest rates can help control inflation by making loans more expensive, which may slow down economic activity. These adjustments are crucial tools for managing economic growth and stability.