Economic Trend Changes for Low Interest Rate and High Interest Rate in South Korea
Economic Trend Changes for Low Interest Rate and High Interest Rate in South Korea

Summary/Abstract: Interest rates are the most crucial factor in the global financial and capital markets, and they greatly impact the entire economy, including the product and service markets. Various economic indicators are affected by changes in the interest rate, and the direction of capital flow changes according to the low or the high interest rate. The interest rate has been continuously increased or frozen to stabilize inflation and recover the liquidity spread caused by the COVID-19 pandemic. Accordingly, this study aims to analyse the impact of interest rate changes on the economy. Among the economic indicators, we focused on the base interest rate, the home sale price, the household debt, and the bond transaction performance. This study used the analysis of covariance (ANCOVA). The research utilized this tool to see the effect of the treatment level on the value of the dependent variable, where the exogenous variable must be controlled by the experimental design. We analysed the economic trend for the low interest rate and the high interest rate for South Korea’s low interest rate low interest rate period (2013–2021) and the high interest rate period (2003-2012, 2022).

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