interbank clearing interest rate
interbank clearing interest ratethe INTEREST RATE at which the COMMERCIAL BANKS in Britain lend short-term funds to one another. The interbank rate of interest influences the BILL-DISCOUNTING RATE at which the BANK OF ENGLAND is prepared to lend money to the DISCOUNT HOUSES. Both these rates are fixed by reference to the ‘official’ rate of interest set by the MONETARY POLICY COMMITTEE at the Bank of England. See alsoBASE RATE.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005