How will raising interest rates help keep Inflation below the 3% mark ?!
Question: How will raising interest rates help keep Inflation below the 3% mark !?
Surely at times of hardship the last thing to do is put more pressure on people, by putting mortgages up,bah!.
Or am I missing the point!? bah!.Www@Enter-QA@Com
Or am I missing the point!? bah!.Www@Enter-QA@Com
Answers:
it wont help one bit!.Www@Enter-QA@Com
lol the idea is to reduce the circulating cash in the economy and ease price pressure!. Increase in the interest rates increases the cost of borrowing thus people do not borrow as much, also increased interest rates means that people save more again reducing money in the economy!. The idea is then spending is cut and the price pressure falls easing inflation!. Think here though this dumb *** government are suffering inflaition they cause by increaseing Taxation on stuff like fuel etc, people have no option but to pay this so increasing interest rates means little!Www@Enter-QA@Com
Putting interest rates up reduces demand because people are less keen to borrow!. Reduced demand reduces the pressure on inflation!.Www@Enter-QA@Com
Raising interest rates curbs peoples spending, which is a factor in fueling inflation!.
It is a cruel to be kind type of policy ;)Www@Enter-QA@Com
It is a cruel to be kind type of policy ;)Www@Enter-QA@Com
Raising interest rates directly affects peoples ability to s[pend more,,this however only ever effects those with a mortgage,,therefore not me,,,Www@Enter-QA@Com
its only maintained by the power of JEEE-zus!.!.!Www@Enter-QA@Com