Federal Discount Rate

Federal Discount Rate,

What is Federal Discount Rate?

The Federal Bank rate is the interest rate set by the central bank (Federal Reserve in the United States) on central bank loans accepted by commercial banks or other institutions. The federal discount rate is used as a measure to reduce liquidity problems and put pressure on essential reserves.

  • The federal bank rate is the interest rate that the Federal Reserve Bank receives on loans, while the federal funds rate is the interest rate that banks receive from each other.
  • The Federal Reserve discount rate is set by the Federal Reserve Board of Governors, while the interest rate on federal funds is determined by the Federal Reserve Open Market Committee.
  • The Federal Reserve is seen as a last resort lender against which the interbank credit system peaks overnight so that the Fed discount rate exceeds the rate of federal funds.

Literal Meanings of Federal Discount Rate


Meanings of Federal:
  1. Refers to a system of ownership or government in which several states form a single unit but remain independent in internal affairs.

Sentences of Federal
  1. Agreement of the Russian Federation that divides power between the Russian federal and local governments


Meanings of Discount:
  1. Decrease the (normal value of something)

  2. Due to lack of credibility (possibly reality or person) it is not possible to see.

  3. Usually a deduction from the normal price of an item given to a particular class of buyers on time or in the case of an advance payment.

  4. (From a store or company) who have a product to sell at a lower price.

Sentences of Discount
  1. Existing users are eligible for discounts.

  2. I heard the rumors but put them aside

  3. Many stores offer discounts on wholesale

  4. Discount Pharmacy China

Synonyms of Discount

take off, ignore, price cut, reduction, disregard, markdown, overlook, deduct, concession, rebate, lower price, gloss over, cut price, pay no attention to, brush off, concessionary price, take no notice of, deduction, take no account of, pass over, cut, dismiss


Meanings of Rate:
  1. Set a pattern or value for a particular scale (object).

  2. Think of it as a particular quality, standard or area.

  3. A measure, quantity or frequency that is usually measured in relation to another quantity or unit of measure.

  4. Scolding (someone) in anger

Sentences of Rate
  1. They were asked to assess their abilities in various driving exercises.

  2. This event was considered a great success.

  3. Promotion price

Synonyms of Rate

judge to be, amount, reckon to be, consider to be, fare, judge, evaluate, price, compute, figure, cost, think to be, measure, put a value on, outlay, appraise, hold to be, adjudge, find to be, estimate, gauge, calculate, assess, value