Glossary › policy rate

Trading glossary · fundamentals

policy rate

The main borrowing cost set by a country's main bank. It affects loans, savings and currencies.

The fuller meaning

The short-term interest rate a central bank sets to steer borrowing costs, inflation and growth. Raising it makes borrowing more expensive and usually cools the economy; markets react mainly to surprises and to hints about its future path.

policy rate.

Related words

adoption · analyst estimate · balance sheet · Bank of Japan · beat · bond · book value · business cycle · cash flow · central bank