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How does raising interest rates control inflation?



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?

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

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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?

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48 comments
@ignatiysharov5465

I once traded on a different platform and ended up losing all my funds. Where were you then, Emma?

@Bako-b8j

Diversification is the secret to optimal performance. This is why I have my interests set on market sectors based on performance and projected growth, such as stock, EV sector, renewable energy, Tech, and Health. Keep investing regularly and you'll be blown away how much it can change in a few short years. Here's to $1 million and to FIRE

@ЕрофейКоваленко-ф9ы

Michael, what heating period do you prefer in trading?

@MorisShelton-m1e

Давид, расскажи про свои самые неудачные сделки, интересно послушать))🐶

@SkyeMurff

Correct explanation, easy to understand. Really this is amazing

@thenottopten6905

The image of Trump as president as he says, "It's not easy to predict the future," though lol

@Nathan-hb3pu

Raising interest rates cannot curb inflation it will only make it worse in the long run

@CrystalJoy-32

The Fed is undoubtedly responsible for the present catch-up efforts, as they were first too slow to control inflation. The pandemic, supply-chain issues, are all contributing reasons to the impending inflationary perfect storm. I'm still looking for companies to make additions to my $500K portfolio, to boost performance.