The Real Interest-Rate Risk
Since 2007, the financial crisis has pushed the world into an era of low, if not near-zero, interest rates, as most developed countries seek to reduce debt pressure and perpetuate fragile payment cycles. But, despite talk of a “new normal,” there is a strong risk that real interest rates will rise in the next decade.
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BEIJING – Since 2007, the financial crisis has pushed the world into an era of low, if not near-zero, interest rates and quantitative easing, as most developed countries seek to reduce debt pressure and perpetuate fragile payment cycles. But, despite talk of easy money as the “new normal,” there is a strong risk that real (inflation-adjusted) interest rates will rise in the next decade.