interest rate

American  

[in-ter-ist reyt, -trist] / ˈɪn tər ɪst ˌreɪt, -trɪst /

noun

Finance.

1. Business. the amount that a lender charges a borrower for taking out a loan, for maintaining a balance on debt, etc.: typically expressed as an annual percentage of the loan balance.

2. Banking. the amount earned on a savings, checking, or money market account, or on an investment, such as a certificate of deposit or bond: typically expressed as an annual percentage of the account balance or investment sum.

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interest rate Cultural  

1. The usual way of calculating interest — as a percentage of the sum borrowed.

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Etymology

Origin of interest rate

First recorded in 1885–90

Compare meaning

How does interest-rate compare to similar and commonly confused words? Explore the most common comparisons:

• discount rate vs. interest rate

Example Sentences

Demand for bonds declined and Treasury yields rose for the second consecutive session as markets grappled with hostilities in the Middle East and high interest rate expectations in the U.S.

From The Wall Street Journal • Jun. 10, 2026

“Gold remains around 18% below its pre-conflict level, reflecting the combined impact of rising bond yields, a stronger dollar, and shifting interest rate expectations.”

From The Wall Street Journal • Jun. 9, 2026

The odds are overwhelmingly in favor of policymakers keeping the benchmark interest rate at the target range of 3.50% to 3.75% at the conclusion of the June 16-17 policy meeting.

From Barron's • Jun. 8, 2026

If you still haven’t paid, the IRS penalties are growing at a 6% annual interest rate.

From MarketWatch • Jun. 8, 2026

The borrower was told he had an “effective interest rate of 7 percent” when he was in fact paying something like 12.5 percent.

From "The Big Short" by Michael Lewis

Related Words

• interest