When interest rates rise, the cost of borrowing money from financial institutions increases. This directly affects businesses that rely on loans and credit lines for operational costs, expansion, and other investments

When interest rate falls

When interest rates fall, the cost of borrowing money from financial institutions decreases. This reduction in interest expenses makes loans and credit lines more affordable for businesses. It directly benefits businesses that rely on external financing for operational costs, expansion, and investments, making it cheaper to finance new projects or refinance existing debts at lower rates.