Glossary › rate cut

Trading glossary · fundamentals

rate cut

When a country's main bank lowers the cost of borrowing money, to help the economy grow.

The fuller meaning

A reduction in the central bank's policy rate to ease financial conditions and support growth. It tends to weaken the currency and support bonds and growth stocks, the opposite of a hike, but markets react mainly to the surprise versus expectations and to guidance.

rate cut.

Related words

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