$69 postpage LB

What are Interest Rates?

  • August 21, 2020 09:47 PM AEST
  • Team Kalkine

What are Interest Rates?

Interest rate can be defined as the amount a bank or a lender charges to the borrower for the use of its assets or money. The rate a bank pays to its depositors for keeping money in a savings account, recurring deposit or fixed deposit is also termed as an interest rate.

Interest rates are frequently charged for mortgages and personal loans, along with loans for the purchase of buildings, cars and other consumer goods. Besides, corporates also take business loans from the financial institution based on prevailing interest rates.

While the term interest rate is used in multiple domains, including cost of borrowing, return on investments and return on savings, it is primarily known for the rate (cash rate or bank rate) charged by Central Banks on its loans and advances to commercial banks. The cash rate further stimulates the rate charged by commercial banks on consumers’ borrowings and saving deposits.

In an economy, interest rates are broadly classified as nominal and real interest rates. While nominal interest rates represent the rate of return to be paid by a borrower without any adjustment for inflation, the real interest rates take inflation into account and reflect the real cost of funds to the borrower.

#InterestRate #Economy #Kalkine

Gold MTF non-AMP

 


Disclaimer
The website https://kalkinemedia.com/au is a service of Kalkine Media Pty. Ltd. (Kalkine Media) A.C.N. 629 651 672. The principal purpose of the content on this website is to provide factual information only and does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion. We are neither licensed nor qualified to provide investment advice through this platform. In providing you with the content on this website, we have not considered your objectives, financial situation or needs. You should make your own enquiries and obtain your own independent advice prior to making any financial decisions.
Some of the images that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed on this website unless stated otherwise. The images that may be used on this website are taken from various sources on the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image. The information provided on the website is in good faith, however Kalkine Media does not make any representation or warranty regarding the content, accuracy, or use of the content on the website.

 

   
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK