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Benchmark Interest Rate
(redirected from Benchmark Rates)

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Benchmark interest rate
Also called base interest rate, it is the minimum interest rate investors will demand for investing in a non-Treasury security. It is also tied to the yield to maturity offered on the comparable-maturity treasury security that was most recently issued (on-the-run).

Benchmark Interest Rate
An interest rate against which other interest rates are calculated. For example, LIBOR is considered a benchmark rate because floating-rate instruments are related to it (for example, one may be calculated as LIBOR + 1%). Central banks make loans to banks under their jurisdiction at certain interest rates, which are then used as benchmarks for the loans those banks make.


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Indonesia and Philippines on Thursday kept their benchmark interest rates unchanged at record lows following central banks in Australia and Thailand, which also held their benchmark rates steady, to keep their borrowing costs steady amid uncertain global economic prospects.
The central bank had cut its benchmark rates by a total 200 basis points until August.
Zhou Xiaochuan, governor of the People's Bank of China, said during the recent session of parliament that the central bank would study a plan to let banks charge less for loans; currently, lenders may offer a discount to benchmark rates set by the PBOC of no more than 10 percent, a favour enjoyed mainly by big firms.
 
 
 
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