Does high interest rates cause recession?
Interest rates are a crucial tool used by central banks to control the economy. They are the cost of borrowing money and can have a significant impact on various aspects of the economy. One of the most debated topics in economics is whether high interest rates cause recessions. This article aims to explore this topic, examining the relationship between interest rates and economic downturns.
In the first paragraph, we have introduced the topic of high interest rates and their potential impact on recessions. The subsequent paragraphs will delve into the historical evidence, theoretical explanations, and the role of central banks in managing interest rates to prevent recessions.
