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So here you are suggesting that when we observe that interest rates have been raised, we should conclude that the economy was strong? (Otherwise the central ba
by eru 1y ago
So here you are suggesting that when we observe that interest rates have been raised, we should conclude that the economy was strong? (Otherwise the central bankers wouldn't have raised.)
But the original comment I first replied to seemed to suggest that high interest rates should lead us to deduce a weak economy.
- mvdtnz 1y agoI don't know if you're being intentionally obtuse but it doesn't matter what caused the increase in rates. The increase results in people and companies having less money to spend and investment being more expensive (by design). This means less hiring.
- efficax 1y agoyou raise interest rates to slow economic activity, you lower them to speed it up. yes, if interest rates are raised, that means employment is too high, basically, and they want to lower it.
- eru 1y ago> yes, if interest rates are raised, that means employment is too high, basically, and they want to lower it. Not directly. The Bank of England targets inflation, not employment.