Interest Rates, Bond Prices & Bond Yield | Economy | By Sivakumar Sir | UPSC | Rau's IAS

Bonds have an inverse relationship to interest rates. When the cost of borrowing money rises (when interest rates rise), bond prices usually fall, and vice-versa.
Most bonds pay a fixed interest rate that becomes more attractive if interest rates fall, driving up demand and the price of the bond.
Conversely, if interest rates rise, investors will no longer prefer the lower fixed interest rate paid by a bond, resulting in a decline in its price.
Yield of a bond is the ratio of interest earned to price of the bond, when the price of bond rises, the yield reduces and vice-versa.
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[@sridha846]

Thank you so much sir..... 🔥🔥🙇🏻‍♂️

[@kamalichavantakur4878]

TQ sir for explanation of this key concepts

[@pauld47386]

Thanks

[@Nikitasolase]

awesome lecture ...thank u so much sir ...

[@TraVeller1530]

Very Nyc explanation Sir...hatss off to.u..❤

[@user-in1xd4gp2q]

Very clear thanks sir

[@artipandey647]

Thank you so much sir 🙏

[@pinkivyas3276]

Nice 👍

[@pragyatripathi4609]

thankyou sir

[@brijinjacob6710]

Thank you for the video. What is the difference between yield and coupon?

[@hemantrajupadhyay1291]

Bring more videos on economics

[@abinashsahoo583]

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