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

The minutes covered the governing council’s deliberations that started March 13 leading up to the March 18 policy decision, at which time officials left its benchmark interest rate unchanged at 2.25%.

From The Wall Street Journal • Apr. 1, 2026

Bond markets are pricing in three interest rate hikes by the European Central Bank and the Bank of England in 2026 and no cuts by the Federal Reserve.

From Barron's • Mar. 31, 2026

This is when car dealers receive commission from lenders, based on the interest rate charged to the customer.

From BBC • Mar. 31, 2026

The ECB left its key interest rate unchanged last week, but expects energy price rises to increase inflation and slow growth.

From The Wall Street Journal • Mar. 27, 2026

The buyer of the second tranche—the second story of the skyscraper—took the next wave of prepayments and in exchange received the second highest interest rate, and so on.

From "The Big Short" by Michael Lewis

Related Words

• interest