Rate Hike Cycle

Rate hike cycle means a period when a central bank raises interest rates multiple times. In simple terms, it is a phase of repeated rate hikes. A rate hike cycle is important because it can make borrowing more expensive, slow demand, reduce inflation pressure, and affect stock and bond markets. Investors watch how high rates may go and when the cycle may end. For example, if the Fed raises rates at several meetings to fight inflation, that is a rate hike cycle. A rate hike cycle does not immediately stop the economy. Its effects can appear gradually as households and businesses adjust.