base rate

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Base rate

British equivalent of the US prime rate.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Discount Rate

The interest rate at which the Federal Reserve makes short-term loans to member banks. The discount rate is an indicator of the direction in which the Federal Reserve is trying to push the broader economy. In general, a low interest rate indicates that it is trying to promote growth by making liquidity easily available, and a high interest rate shows that the Fed is concerned about inflationary pressures on the economy and trying to reduce the amount of money in the economy. Along with the sale of Treasury securities and the determining of the fed funds rate, setting the discount rate is one of the primary ways the Federal Reserve sets the monetary policy of the United States.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

base rate

Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

base rate

the INTEREST RATE that is used by the COMMERCIAL BANKS to calculate rates of interest to be charged on bank loans and overdrafts to their customers. For example, a large company might be charged, say, an interest rate of base rate plus 2% on a loan, whereas a smaller borrower might be charged, say, base rate plus 4%. Formerly, base rates were linked directly to BANK RATE but are now fixed by reference to the ‘official’ rate of interest set by the MONETARY POLICY COMMITTEE of the Bank of England. See PRIME RATE.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
Ms Thrussell said: "In so many cases the rate guaranteed limit is set below the current pay rate, so even if base rate remains unchanged, the provider has the right to lower your rate and still stay within its promise.
During the period,eight of the 10 largest lenders had increased the difference between the Bank's base rate and their own standard variable rate, with just Nationwide Building Society and HSBC reducing it.
Ranges and their corresponding base rates Range Base rate (%) Range Base rate (%) 1 0-3 7 50-60 2 3-10 8 60-70 3 10-20 9 70-80 4 20-30 10 80-90 5 30-40 11 90-97 6 40-50 12 97-100 Four positive-outcome and four negative-outcome items were selected out of the initial pool for each range, but only three negative-outcome items were available for range 10 and none for ranges 11 and 12.
State-run Vijaya Bank (532401.BO) (VIJAYABAN.NS) (VJBK.NS) has said that it has reduced its base rate by 0.15 percent to 9.85 percent.
The minister said all the banks have given an assurance that they would review their base rate this month and they would take an appropriate decision on cutting the base rate.
With the introduction of the base rate from 1 July 2010, banks are required to price all categories of loans with reference to the base rate.
Peter Cornish, head of customer offer at NS&I, said: "The changes to our interest rates reflect the fall in the Bank of England base rate"This has affected banks and building societies across the board, with many of our competitors reducing rates to their savings products over the past month.
Chase de Vere Mortgage Management has a new deal offering a discount on the Bank of Englands base rate. But that discount improves if England reach the final and again if they win.
Indian' private sector lender HDFC Bank (500180.BO) (HDFC.NS) (NYSE: HDC) has cut base rate or minimum lending rate by 0.15 percent, The Economic Times reported.