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The Shanghai and Shenzhen 300 index on Thursday fell from a record on speculation that the government would raise interest rates after the statistics bureau reported faster-than-expected economic growth and inflation . The other two were 1932 and 1933 during the Great Depression.During the Depression , when as many as one in four people were out of work , households were exhausting savings in order to pay the rent and buy food.Last year 's negative rate was attributed not to a lack of jobs but to good economic developments - - including low interest rates that made it attractive to borrow money to make purchases and also to refinance home loans.While the Federal Reserve was raising interest rates for part of last year , those increases followed an extended period when the Fed had driven rates down to the lowest levels in more than four decades.Low interest rates helped to fuel a boom in housing purchases , which in turn helped to drive home prices higher . Overall , we might not find evidence for the revisionist view that raising interest rates could actually worsen currency depreciation , but neither do we find evidence that such action will significantly stem such depreciation . Toward the end of October , the Federal Reserve Board finally took a break after steadily raising interest rates for the last two years . Yet raising interest rates could also hit Beijing 's coffers - hard . Raising interest rates could be risky , too . China surprised global markets on April 27 by raising interest rates for the first time in 18 months to slow a debt-driven boom that risks destabilizing the world 's fastest-growing major economy . The People 's Bank of China recently surprised financial markets by raising interest rates for the first time in nine years . Accordingly , all of the members took the view that from the central bank 's macroeconomic standpoint , it would be an extremely difficult choice to raise interest rates under the current economic condition . Some Directors , however , were concerned that raising interest rates could worsen the domestic liquidity management problem . Capacity use measures actual industrial output compared to its potential output , and the Bank of Canada closely watches spare capacity in the economy to determine whether to raise interest rates should inflation start to rise . While the U.S. Federal Reserve was raising interest rates for part of last year , those increases followed an extended period when the Fed had driven rates down to the lowest levels in more than four decades . And fourth , it would be too late to raise interest rates after confirming a full-scale recovery in business fixed investment .