Loan Modification

I have read that large trade deficits in Western countries in conjunction with large trade surpluses in the emerging Economies (China particularly), was the main driving factor of lower interest rates? But I don’t understand why this caused the low interest rates? How exactly did the large flows of capital into the US and other advanced nations result in lower interest rates?
Can someone please explain the process and logic that would cause lower interest rates?
Thanks for any help.

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Tags: Capital, Capital Flows, Capital Markets, Cause, Conjunction, Emerging, Emerging Economies China, Emerging Markets, Flows, From, Interest, Logic, Low Interest Rates, Lower, Markets, particularly, Rates, Trade Deficits, Trade Surpluses, West, Western Countries

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