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Why do interest rates change over time?

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The most important factor in determining why interest rates change is the supply of funds available from lenders and the demand from borrowers. Let's use the mortgage market for our example. In a period when many people are borrowing money to buy houses, banks need to have funds available to lend. read more

Why Interest Rates Change. Interest rates change over time, reflecting both the demand from borrowers and the supply of funds available to be loaned by providers of capital. The best way to think of interest rates is as the “price of money”. read more

Interest rates affect many facets of borrowing money and is based off of supply and demand. Interest rates also vary based on the terms of the loan provider and the amount of time for repayment. read more

From the early 1980s through today, interest rates have fluctuated significantly. After the hyperinflation of the 1970s, interest rates remained high during the early 1980s, peaking in 1981 at over 16 percent. During the mid 1980s and early 1990s, the federal funds rate declined, ranging from 5 to 8 percent. read more

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