Interest Rates Flashcards
1
Q
Interest Rate=
A
The reward of saving and the cost of borrowing
2
Q
Who sets the interest rates?
A
The Bank of England (MPC- Monetary Policy Committee)
3
Q
If interest rates are high what does this mean for the £?
A
The pound will be STRONG because sterling is in high demand due to increased hot money
4
Q
If interest rates are LOW what does this mean for the £?
A
The £ will be WEAK because the Sterling suffers decreased demand as there is less hot money
