Term of the Day: Fisher Effect

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	INVESTOPEDIA Term Of The Day September 9, 2015 Fisher Effect An economic theory proposed by economist Irving Fisher that describes the relationship between inflation and both real and nominal interest rates. The Fisher effect states that the real interest rate equals the nominal interest rate minus the expected inflation rate. Therefore, real interest rates fall as inflation increases, unless nominal rates increase at the same rate as inflation. Breaking It Down: The Fisher effect can be seen each time you go to the bank; the interest rate an investor has on a savings account is... Read More Related to "Fisher Effect" Fisher Effect The Fisher effect states that the real interest rate equals the nominal interest rate minus the... Read More Macro Environment The macro environment is the conditions existing in an economy as a whole, rather than in a single... Read More Subjective Probability Subjective probability does not use formal calculations or sophisticated data analysis. It's an opinion reached by... Read More Recently Added Definitions Equity Market The market in which shares are issued and traded, either through exchanges or... Read More Operating Cost Operating costs are expenses associated with the maintenance and administration of a... Read More Related Definitions Consumer Price Index - CPI Producer Price Index - PPI Retail Prices Index - RPI Hyperinflation Deflation Past Terms of the Day Draghi Effect Robin Hood Effect Economic Depreciation Depreciation Recession You are currently subscribed as: mondemand.forex@blogger.com Unsubscribe | Unsubscribe From All | Manage Profile Investopedia US, A Division of IAC. Copyright © 2015, Investopedia, LLC. All Rights Reserved Follow Us: