The correlation between interest rates and stock prices is:

Question

Quizplus · Accepted Answer

The relationship between interest rates and stock prices is generally inverse. When interest rates rise, the cost of borrowing money increases, which can lead to lower spending by consumers and lower profits for companies. As a result, stock prices may decrease. Conversely, when interest rates decrease, the cost of borrowing money decreases, which can lead to increased spending by consumers and higher profits for companies. This can lead to higher stock prices.

The Correlation Between Interest Rates and Stock Prices Is