>>Hilmar,
>>
>>Yes, interest rates are low right now. Here in the US, interest rates often move with the Fed rate. I did a google search, here's an article:
>>
>>http://www.chron.com/cs/CDA/story.hts/business/buggs/789208
>>
>>The Fed rate is low right now, and was cut several times last year by Greenspan...in an attempt to encourage the economy to grow.
>>
>>Of course there are factors besides the Fed rate that affect interest rates. Supply and demand.
>>
>>
>>>Interest rates for bank deposits and similar have gone down drastically in the last 2 years, approximately, here in Bolivia. I have heard that the same happens world-wide. 1) Is this true? 2) If yes, what might have caused this?
>>>
>>>Hilmar.
>
>Hmmm... Well, first of all, thanks for your reply. Now, this information seems to pose at least as many questions as it answers! For instance: If lowering the Fed rate tends to make the economy grow, would that make the interest rates go up again, in the long term? Did the lowering of the Fed rate affect - perhaps indirectly - most other countries, who are now "following suit"? What caused the economic slowdown in the first place? Is the tendency showing signs of reversal?
>
>Too many questions, some of them quite tricky, I know!
>
>Hilmar.

When the economy gets strong, the Chariman of the Federal Reserve will raise interest rates, both to prevent inflation and to prevent "speculative bubbles" in the stock market which, when they pop, lead to recession.

I know that Bolivia had hyperinflation several years ago. What are typical inflation rates these days? In Brazil, inflation tends to be high, though not as bad as it was years ago. Bank interest rates there and also in Mexico are indexed for inflation, if I understand correctly. Interest rates on loans in such countries would thus have nothing to do with rates elsewhere in the world or even with the strength of their own economy - only to their currency policy.