New Delhi, June 12 -- On Thursday, the European Central Bank (ECB) raised benchmark interest rates for the euro zone, joining a growing number of global central banks tightening their monetary policies.

As the era of cheap money winds down, Mint explains why interest rates are surging worldwide and how this global shift will impact India's economy, markets, and borrowing costs.

Between 2008 (immediately after the global financial crisis) and 2022, the world enjoyed a prolonged era of cheap money, i.e low Interest rates. In the US, rates were as low as zero to 0.25% in that period, a trend mirrored across most developed economies.

This low-rate era ended following the covid pandemic. Massive government stimulus packages triggered a seve...