Bank rate
From Wikipedia, the free encyclopedia
- For the company, see Bankrate.
Bank rate, also referred to as the discount rate, is the rate of interest which a central bank charges on the loans and advances that it extends to commercial banks and other financial intermediaries. Changes in the bank rate are often used by central banks to control the money supply.
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[edit] United States
no difference betwwen bank n\intrest rate and bank rate.
[edit] Difference between Bank Rate and Repo Rate
While repo rate is a short-term measure, i.e. applicable to short-term loans and used for controlling the amount of money in the market, bank rate is a long-term measure and is governed by the long-term monetary policies of the governing bank concerned.
[edit] Regional Bank Rate
Though influenced heavily by the Federal Reserve Interest rate, all bank rates will vary regionally. It pays to compare interest rates on a regional or state-wide level.
[edit] United Kingdom
In the UK bank rates are set by the Bank of England's Monetary Policy Committee. The key interest rate is called the official bank rate[1] which is the lowest rate at which the Bank acts as lender of last resort to the money markets.
[edit] Canada
In Canada, the bank rate is defined as the upper limit of the overnight rate band announced each month by the Bank of Canada, (making it the target overnight rate + 0.25%).[2]
[edit] References
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Wikisource has the text of the 1911 Encyclopædia Britannica article Bank Rate. |
- ^ "CHANGES IN BANK RATE, MINIMUM LENDING RATE, MINIMUM BAND 1 DEALING RATE, REPO RATE AND OFFICIAL BANK RATE". http://www.bankofengland.co.uk/statistics/rates/baserate.pdf.
- ^ Siklos, Pierre (2001). Money, Banking, and Financial Institutions: Canada in the Global Environment. Toronto: McGraw-Hill Ryerson. pp. 50-51. ISBN 0-07-087158-2.
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