Economics
Why the Ride up for Interest Rates Could Be Much Bumpier Than the Road Down
Here are theories why global interest rates, after 30 years of decline, may be about to rise again.
A labor glut, about to subside?
Photographer: Matthew Busch/BloombergThis article is for subscribers only.
Global interest rates have been in decline for the past 30 years, but a growing number of economists argue that this could soon be about to change.
As a recent presentation by Charles Bean, president of the Royal Economic Society, former deputy governor at the Bank of England, and professor at the London School of Economics, illustrated, the world real interest rate (or the "neutral rate") has fallen from around 4 percent in the early 1990s to around zero today.