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1.The interest rate is usually set by the central bank of a country, which also serves as a lender for commercial banks.

2.When buying houses many people take out mortgages from commercial banks. If the interest rate increases, the mortgage becomes more expensive.

3.If the interest rate is low, companies invest and expand their business, the national currency value falls and national goods and services, become cheaper for foreign buyers. Export begin to grow and more money come into the economy.
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