Sentences with phrase «when nominal interest»

In contrast, real interest rates can be negative, when nominal interest rates are below inflation.

This occurs when the nominal interest rate is equal to the growth rate of nominal wages.

Not exact matches

There is a natural tendency for asset values to decline in line with deflation, whereas the nominal value of debt is constant (and, when interest costs are added, the nominal value of monetary obligations actually increases).

If the situation deteriorates for a given issue, history has shown there is often a window of time when it is not particularly painful to switch out to a practically identical bond, with much better interest coverage, for nominal costs.

The U.S. economy has never been willing to hold more than 10 cents of base money per dollar of nominal GDP except when interest rates were substantially below 2 %.

If the «pe» of bonds and stocks is both high, bond principals will at least not lose nominal principals when interest rates rise.

When we talk about the Bank of Canada offsetting rather than accommodating changes in fiscal policy, it is important to understand that we are talking about changing the nominal interest rate relative to what it would have been otherwise without the fiscal policy change, and not relative to what the nominal rate was in the past.

When overall prices decline, Ibonds retain their full principal amount in terms of nominal dollars and they always pay the full amount of the interest coupon.

When describing concepts such as interest rate or GDP, nominal refers to their unadjusted rate, value or current price without taking elements such as inflation, seasonality, loan fees, interest compounding or other factors into account.

Quite the juxtaposition in global equity performance, but understandable when one considers the prior period global spillover of Fed QE into the global asset markets all in the search for higher rates of return in a period that had become an ice age for nominal US interest rates.

Annual interest rate compounded daily This is the nominal interest rate, from which the effective rate is calculated when compounded daily.

Annual interest rate compounded monthly This is the nominal interest rate, from which the effective rate is calculated when compounded monthly.

Bernanke suggested that, «Central Bank communication provides additional means of increasing the degree of policy accommodation when short - term nominal interest rates are near zero.

If so, then the nominal yield when the Fed finishes normalizing interest rates will be around 4 %.

However, when financial repression produces negative real interest rates (nominal rates below the inflation rate), it reduces or liquidates existing debts and becomes the equivalent of a tax — a transfer from creditors (savers) to borrowers, including the government.»

As the Swiss National Bank demonstrated in December 2014 when the institution lowered its deposit rate to − 0.25 %, the cost of storing cash is the actual lower bound for nominal interest rates.

* When attorneys handle nominal or short - term client funds that can not earn net interest for their clients, they place these funds in pooled, interest - bearing accounts.