prime rate
Bank's base percentage
Prime rate is the interest rate that commercial banks charge their most creditworthy customers, typically large corporations with strong credit histories.
It serves as a benchmark for many other lending rates, with consumer loans often set as "prime plus" some percentage.
When the Federal Reserve adjusts its rates, banks typically follow by raising or lowering the prime rate accordingly.
My credit card rate is tied to the prime rate, so it changes when the Fed moves.
US central banking system
- central bankNational currency management institution
- monetary policyCentral bank economic controls
- tighteningMaking less loose
- easingReducing strain or difficulty
Financing for company operations
- business loansCredit extended to enterprises
- credit cardsBorrowed-money payment tools
- lines of creditPre-arranged borrowing capacity
- borrowersThose receiving loans
bank loans · creditworthiness · credit score · underwriting · margin · spread · markup
Sustained price level increase
- recessionProlonged economic decline
- expansionIncrease in scope
- GDP growthOutput increase percentage
- economic indicatorsData measuring financial health
business cycle · consumer spending · borrowing costs · economic outlook · market conditions · financial markets · investment climate
Federal Reserve
US central banking system
- central bankNational currency management institution
- monetary policyCentral bank economic controls
- tighteningMaking less loose
commercial loans
Financing for company operations
- business loansCredit extended to enterprises
- credit cardsBorrowed-money payment tools
- lines of creditPre-arranged borrowing capacity
bank loans · borrowers · creditworthiness · credit score · underwriting · margin · spread · markup
inflation
Sustained price level increase
- recessionProlonged economic decline
- expansionIncrease in scope
- GDP growthOutput increase percentage
economic indicators · business cycle · consumer spending · borrowing costs · economic outlook · market conditions · financial markets · investment climate
LIBOR
Interbank lending benchmark rate
- financebank, CFO, banks, controller, finance
- financial termswealth, asset, currency, balance sheet, audit
- ratesroyalty, per diem, interest rates, exchange rates, percentage
- mortgagesmortgage broker, mortgage payment, mortgage insurance, mortgage deed, home loan
- credit termsloans, installment loan, credit limits, monthly payment, credit cards
- economic dataGDP, CPI, PPI, inflation rates, employment data