Hey there guys. I’m just a 15 year old teenager who so happens just to like economics and politics about. During my research in macroeconomics, something that I’ve failed to understand is how specifically does raising or decreasing interest rates affect inflation. Because I hear people say a country is raising interest rates to keep inflation down but can someone in a clear way, explain how it does so?
What is the relationship between interest rates and inflation?
byu/Powerful_Parsnip6427 inAskEconomics
Posted by Powerful_Parsnip6427