What is the 'Discount Rate'?

Discount rate is the interest rate charged to commercial banks and other depository institutions for loans received from the Federal Reserve's discount window. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Term of the Day | INVESTOPEDIA Discount Rate The discount rate is the interest rate charged to commercial banks and other depository institutions for loans received from the Federal Reserve's discount window. The discount rate also refers to the interest rate used in discounted cash flow analysis to determine the present value of future cash flows. Breaking it Down: The Fed's discount rate is an administered rate set by the boards of the Federal Reserve Banks and approved by... Read More » Related to "Discount Rate" How Banks Set Interest Rates on Your Loans Are you planning on getting a loan from bank? Here is the information you need know on how banks set the interest rates to get the best possible deal. Read More » How interest rates affect property values Interest rates have profound impact on the value of income-producing real estate property. Find out how the rise and fall of interest rate affects property value. Read More » How interest rate cuts affect consumers Traders rejoice when the Fed drops the rate, but is it good news for all? Find out here. Read More » Related Definitions Bank Rate A bank rate is the interest rate at which a nation's central bank lends money to domestic banks, which in turn impacts economic activity. Read More » Volume Discount Volume discounts are financial incentives for individuals or businesses that purchase goods in multiple units or in large quantities. Read More » Key Rate The key rate is the specific interest rate that determines bank lending rates and the cost of credit for borrowers. Read More » Discount In finance, discount refers to a situation when a bond is trading for lower than its par or face value. Read More » CONNECT WITH INVESTOPEDIA Email sent to: mondemand.forex@blogger.com If you wish to unsubscribe, please click here, or manage subscriptions 114 West 41st St, floor 8 New York NY 10036 © 2019, Investopedia, LLC, All Rights Reserved | Privacy Policy