The Financial Outlook for Personal Investors: How do markets react to falling interest rates?

So far this year there have been 108 interest rate cuts worldwide. Russ Mould of A J Bell has crunched the numbers for 13 interest rate cycles and found that the All-Share Index averages a gain of 16.5% after 2 years from falling rates. However, with investors often anticipating cuts, markets are far more volatile for the first 3-6 months. Russ also considers whether very low rates are a good thing, pointing out that a quest for stability by central banks can ultimately lead to greater instability.