Which Way for Interest Rates?

Daily movements in interest rates have become as closely watched as baseball box scores. For three years, the cost of borrowing money has been painfully high and shockingly erratic. This summer, however, the news from the money market has been good enough to cheer about. Since July, the prime rate that banks charge for short-term corporate loans has fallen from 16.5% to 13.5% and aroused hopes for a sustained decline in interest costs.

Though this new optimism has buoyed businessmen and excited the stock market, TIME's Board of Economists warned last week that the progress on interest rates will probably soon stall....

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