Sean Renaud
The West Coast Pop
- Joined
- Feb 5, 2004
- Posts
- 59,648
How does hiking rates lower inflation
I know, lowers demand by killing economic activity
Then what you really mean is. Kill economy, lower rates
While a bit of an oversimplification this is correct. Keep economic activity a little lower and keep inflation under control.
I say lower rates. Boom economic activity and productivity
Lower inflation
I don't believe it would be "Boom economic activity" but there would be an increase. On no planet does that lead to lower inflation. An absolute best case scenario and absolute fantasy scenario is one where we don't see really high inflation but the world where lower inflation results from increased economic activity doesn't exist.

