Second, in terms of changes in interest rates, a rise in interest rates could cause stocks to crash. In recent years, interest rates have remained quite low. As a result of the Fed's monetary easing policy, which also purchased a large amount of bonds, the real yield has been below 0%. This is because when the coronavirus pandemic was at its worst, the Federal Reserve was concerned that the U. S. economy would be hit harder than the Lehman shock. Federal Reserve Chairman Powell has said that he will keep interest rates low until inflation rises to 2% and employment recovers, and he has not specified a specific time frame. In the U. S. , the economy is on the road to recovery, but it is not perfect and the risk of monetary tightening by the central bank is high, leading some people to believe that interest rates will not rise for some time.
Second, in terms of
changes
in
interest
rates
, a rise in
interest
rates
could cause stocks to crash. In recent years,
interest
rates
have remained quite low.
As a result
of the Fed's monetary easing policy, which
also
purchased
a large amount of bonds, the real yield has been below 0%. This is
because
when the coronavirus pandemic was at its worst, the Federal Reserve
was concerned
that the U. S. economy would
be hit
harder than the Lehman shock. Federal Reserve Chairman Powell has said that he will
keep
interest
rates
low until inflation rises to 2% and employment recovers, and he has not specified a specific time frame. In the U. S.
,
the economy is on the road to recovery,
but
it is not perfect and the
risk
of monetary tightening by the central bank is high, leading
some
people
to believe that
interest
rates
will not rise for
some
time.