Think interest rates are high? You won’t believe how much borrowing money costs in other countries
Borrowing money is an expensive business, with countries imposing huge interest rates.
If you thought borrowing was expensive at home, spare a glance at some of the numbers that the foreign markets are dealing with. With numbers released from World of Statistics, we can see that Türkiye’s central bank has set rates at an eye-watering 43%. No, that’s not a typo.
The country is battling inflation running high and a currency that has been in free fall for months (watch out, Donald). The logic is simple enough: raise rates, cool prices, and defend the lira. However, whether or not such extreme measures can restore confidence without crushing domestic growth is — quite literally — a billion dollar question.
Argentina follows, at 29%, and the story is just as bleak. The peso has been stuck in a cycle of devaluation and recovery for years, with inflation so entrenched thanks to Javier Milei’s ruinous decisions that rate hikes have become commonplace rather than curveballs.
Russia (18%) and Brazil (15%) sit in the middle tier: for Moscow, international sanctions and a volatile currency have forced Putin into a defensive stance. Brazil’s situation is less geopolitical but just as delicate, as the economy remains sluggish.
Mexico (7.75%) and South Africa (7%) may appear low by comparison, but both remain well above the levels seen in developed economies. Banco de México has opted for caution, holding rates high to prevent inflation from creeping back. In Pretoria, policymakers are trying to balance slow growth with price pressures that refuse to disappear.
By contrast, the United States sits in a very different position. The Federal Reserve’s benchmark rate currently sits around its highest level in over two decades. While inflation has begun to cool, the Fed under Jerome Powell has remained cautious, thanks to the disastrous decisions of the Trump administration’s fiscal policies, including large tax cuts and expansive spending.
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Unlike the rash decisions from the administration, who treat the US economy like a game of Kerplunk, Powell’s moves are strategic, designed to balance demand and inflation, despite what the President says.
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