1. Presentation on Determinants of Interest Rates Subject: Financial Markets and Institutions Presented by: Amrapali Ughade Roll No. F3010
2. Introduction Interest rates are a key component in many market prices and an important economic barometer. They are comprised of the real rate plus a component for expected inflation, since inflation reduces the purchasing power of a lender’s assets.
3. Determinants of Interest Rates Market Expectations Inflationary pressures General economic conditions Monetary policy and the stance of the central bank Foreign exchange market activity Foreign investor demand for debt securities Financial and political stability
