Interest Rate Risk

Related Terms

• Risk Sentiment

  Risk sentiment is a term used to describe how financial market participants (traders and investors) are behaving and feeling. What traders choose to buy or sell means balancing how much they are prepared to lose with how much they hope to earn. You can look at risk sentiment as the expression of traders’ and investors’ willingness to […]

• Monetary Easing

  Monetary easing refers to actions taken by central banks to stimulate economic growth by increasing the money supply and reducing interest rates.

• Carry Trade

  Carry trade is a widely-used trading strategy that involves borrowing in a low-interest-rate currency and investing in a high-interest-rate currency to profit from the interest rate differentials. This strategy is particularly popular in the foreign exchange market, where traders seek to capitalize on the differences between countries’ interest rates. Let’s explore the concept of carry […]

• Forward Guidance

  Forward guidance is a tool used by a central bank to try and influence market expectations of future levels of interest rates. “Forward guidance” in monetary policy means providing some information...

• Neutral Interest Rate

  The neutral interest rate represents the real (inflation-adjusted) short-term interest rate that is consistent with a stable economy operating at its full potential.