Published
05/13/2026, 08:50The era of ultra-cheap money, which lasted more than a decade following the 2008 global crisis, has effectively come to an end. The rapid rise in interest rates between 2022 and 2024 has posed a serious challenge to the global economy and financial system.
As noted in the EDB’s macroeconomic forecast, the consequences have already manifested in the form of bankruptcies among financial institutions in the U.S., rising borrowing costs, and reduced business resilience.
“The global economy has effectively returned to higher and ‘normal’ rates following a prolonged era of ultra-loose monetary policy,” the forecast states
The new conditions have drastically changed borrowing costs. While in 2019–2020 companies could secure loans in the eurozone at 1.5–2% per annum and in the U.S. at 2–3%, by 2024 refinancing rates had risen to 5–6%.
High rates have already begun to weigh on investment. According to the EDB, corporate investment in developed economies grew by only 1% per year in 2023–2024—significantly slower than in 2000–2019, when growth averaged 2–4% annually.
“A prolonged period of expensive money could slow global economic growth and heighten the risks of financial instability,” economists warn.
