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 war in Ukraine triggered a huge rise in inflation and a new era of rising interest rates, pushing up the cost of Asda's borrowings.

From BBC

But Lewis said there was growing anger, particularly among those in England and Wales with Plan 2 loans, because recent higher inflation has resulted in increased interest rates being applied to the loans.

From BBC

Bessent and Warsh, who have both worked for famed investor Stanley Druckenmiller, could end up reorganizing the responsibilities of the Treasury and Fed, giving Treasury a more active role in managing long-term interest rates.

From The Wall Street Journal

Along with the other three finalists for the post to succeed Jerome Powell as head of the central bank, Warsh has endorsed further cuts in the Fed’s main policy interest rate.

From Barron's

"Doves" are seen to favor lower interest rates to boost the economy while "hawks" are inclined towards higher rates to curb inflation.

From Barron's

Related Words

• interest