How The Rate Is Determined and Its Impact On The Economy
The interest rate that is charged by a country’s central or federal bank on loans and advances to control money supply in the economy and the banking sector. This is typically done on a quarterly basis to control inflation and stabilize the country’s exchange rates. A fluctuation in bank rates triggers a ripple-effect as it impacts every sphere of a country’s economy. For instance, the prices in stock markets tend to react to interest rate changes. A change in bank rates affects customers as it influences prime interest rates for personal loans. It is the rate at which central bank provides to the commercial bank for the excess reserves being kept with the central bank.
Read more about this topic: Bank Rate
Famous quotes containing the words rate, determined, impact and/or economy:
“Strange that the vanity which accompanies beautyexcusable, perhaps, when there is such great beauty, or at any rate understandableshould persist after the beauty was gone.”
—Mary A. [Elizabeth, Countess Von] Arnim (18661941)
“Patriotism having become one of our topicks, Johnson suddenly uttered, in a strong determined tone, an apophthegm, at which many will start: Patriotism is the last refuge of a scoundrel. But let it be considered that he did not mean a real and generous love of our country, but that pretended patriotism which so many, in all ages and countries, have made a cloak of self-interest.”
—Samuel Johnson (17091784)
“The question confronting the Church today is not any longer whether the man in the street can grasp a religious message, but how to employ the communications media so as to let him have the full impact of the Gospel message.”
—Pope John Paul II (b. 1920)
“War. Fighting. Men ... every man in the whole realm is in the army.... Every man in uniform ... An economy entirely geared to war ... but there is not much war ... hardly any fighting ... yet every man a soldier from birth till death ... Men ... all men for fighting ... but no war, no wars to fight ... what is it, what does it mean?”
—Doris Lessing (b. 1919)