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November 1981

What Really Happened to Interest Rates?: A Longer-Run Analysis

by G.J. Santoni and Courtenay C. Stone

The purpose of this article is to discuss the factors primarily responsible for the rise and increased variability in interest rates in recent years. The analysis is not intended, nor can it be used, to explain every jiggle and jog in interest rates that occurred during this period. Instead, it is meant to uncover those factors that have influenced the longer-term behavior of interest rates over the past 15 years.