base rate

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Base rate

British equivalent of the US prime rate.

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.

base rate


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.
References in periodicals archive ?
Base rate, the new benchmark system for pricing loans, has been implemented by banks from 1 July.
Expect a base rate cut sooner rather than later in 2001 - that's the Christmas message from Paul Parker, director of independent mortgage brokers Charcol in Birmingham.
Alliant Energy s retail electric base rates have been stable since 2010 and retail natural gas base rates have decreased.
Allows for base rates to adjust in 2013, better reflecting the true costs for the company to maintain and improve the electric system.
STATE Bank of India ( SBI), the largest lender in the country, announced a hike in its lending rates -- the base rate, which came into effect from July 1, 2010, by 0.
This was the last time the UK saw an increase in base rates.
This positive news comes even as the base rate system comes into effect from Thursday ( July 1, 2010).
Alliant Energy s electric base rates have remained stable and natural gas base rates have decreased since 2010.
Alliant Energy's electric base rates have remained stable and natural gas base rates have decreased since 2010.
India's largest lender -- SBI -- raised its base rate by 40 basis points (bps) to eight percent from Saturday from 7.
Summary: Replacement of the benchmark prime lending rate (BPLR) for banks with base rate, on 1 July 2010.
What next: Banks will now have to display information on their base rates at all branches and their websites.