- Low interest rate *encourages* people to borrow more and spend more?
- Cheaper borrowing … encourages spending and investing?
- People want access to more funds?
One sentence:
Low interest rates encourage borrowing and spending, which can stimulate the economy, while high interest rates can have the opposite effect, acting like a brake on economic growth.
why? One sentence:
Interest rates impact the economy because they affect the cost of borrowing, which in turn influences people’s and businesses’ decisions to spend and invest.