Abstract

The impact of fluctuations in interest rates on the volatility of the stock market has sparked endless discussions and debates among finance researchers and practitioners. These encompass the enigmatic liquidity effect, the elusive discount rate effect, and the cryptic signalling effect. To solicit the wisdom of seasoned stock market analysts, astute economists, and proficient finance professionals. The influence of interest rate changes on stock market volatility, untangle the intricate transmission channels through which this influence manifests, and discern the myriad factors that might temper or amplify this complex relationship. While a contingent of experts vehemently advocate for a robust and direct relationship, an equally passionate faction underscores the pivotal role played by other factors such as economic fundamentals and prevailing market sentiment. The tapestry woven by these varying viewpoints forms the essence of our scholarly discourse. It is an invaluable resource, catering to the intellectual appetites of researchers, policymakers, and discerning investors who seek a profound and holistic comprehension of this pivotal relationship within the realm of financial markets. The researcher had considered stock market experts to know the influence of interest rate changes on stock market volatility and found that interest rate changes Reduce economic activity and investor sentiment and foster sharp stock market volatility and High interest rates intensify borrowing costs, discourage investments, and hinders economic activities

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