Take, for example, one indicator of the market's appetite for risk, the spread between swaps of fixed- and floating-rate interest payments (see chart).
Loans from any of these sources can come in a number of flavors, including fixed interest rate or adjustable interest rate, and with various terms, from 5 years for some adjustable-rate loans up to 40 years for some.
Primarily based on Eurodollars, U.S. Treasuries, swaps and other dollar-related instruments that customers can utilize to manage short, medium and long term interest rate risk, interest rate contracts are the largest class of financial products traded on CME Group.
FORBES: Rising Volume Tied To Interest Rates Is Good For CME Group
Some seniors have been burned by cards with a short-term low interest rate followed by a high interest rate, so be sure to read the fine print and know how long the rate will last.
As US unemployment continues to head south towards its natural rate, and the prospect of an interest rate spike is a possibility, there is one factor that may avert, or at least moderate, an interest rate spike: The yen tsunami, i.e.
The other major changes is the interest rate is going to a fixed interest rate of 6.8 percent, which, in the immediate right now is going to be an increase in the rates that students pay.
Guardian Care Homes accuses the bank of mis-selling it an interest rate hedging product linked to the Libor interest rate which Barclays, and other major international banks based in London, are now known to have manipulated.
And for them, if the lender lowers their interest rate for five years - and that interest rate could go as low as, say, three percent - and that makes the payments affordable, the government would then guarantee the loan.
Since the Fed started paying IOR, the IOR interest rate has continuously been higher than the market interest rate on 90-day T-bills.
FORBES: This Economic Recovery Is Surely Different: It's FUBAR*
Well, interest rate baring checking accounts currently pay out an average interest rate of .08 percent, according to the Federal Deposit Insurance Corp.
FORBES: Careful: Saving For An Emergency Could Become Its Own Emergency
The Bank of England's figures show that as of last November, the average credit card interest rate was 15.89%, while the average interest rate for a standard variable rate mortgage was just 3.98%.
Within the Latin American forex space, the Mexican peso now looks more attractive from a carry perspective that is where low interest rate countries like Japan buy the local debt of higher interest rate countries.
FORBES: Brazilian Finance Minster Gets His Wish, BRL Heading To 2
While traditionally one would trade bonds to make such bets, by entering into either side of an interest rate swap agreement, you would gain immediate exposure to interest rate movements with virtually no initial cash outlay.
The carry trade involves a currency play in which a lower interest rate currency is sold to purchase a currency with a higher interest rate.
FORBES: Outlook 2012: Can U.S. Dollar Bulls Keep Hold Of The Reins?
And once that comes down, the interest rate on all sorts of other things comes down, like the interest rate on car loans or credit cards.
In comments following the bank's widely anticipated decision to leave its benchmark interest rate unchanged at 0.75 percent, Draghi confirmed that an interest rate cut was discussed.
All things equal, for typical bonds the longer the maturity the higher the duration (or price volatility from interest rate movements), and the smaller the coupon the higher the interest rate risk.
Just because the interest rate is determined largely by the growth rate of the economy, it does not necessarily follow that the interest rate should be the same as the growth rate of the economy.
High savings (sometimes mandatory), interest rate controls, and high economic growth let Chinese banks enjoy a steady interest rate spread and a larger loan volume.
Second, interest rates were variable, which is fine in a low interest rate environment, but which could be very destabilizing for a company when interest rate spiraled upward, as they did in the 1970s.
And the Senate rejected a proposed amendment that would have prohibited lenders (credit card lenders included) from charging an interest rate on any credit transaction (except real estate) that exceeds the maximum interest rate allowed by state law.
As of Thursday, a 5 year AAA corporate bond has an interest rate of 1.21% and a 5 year AAA muni bond has an interest rate of 0.93%.
FORBES: Obama's Deduction Cap, Tax-Exempt Bonds, and Economic Illiteracy (WSJ Example)
When thinking about the cost of this kind of arrangement, many people would focus on the interest rate on the bond the government is issuing (just as they focus now on the interest rate on the promissory notes).
FORBES: How Much Would Ireland Benefit from Replacing the Promissory Notes with a Long-Term Bond?
JPMorgan Chase, Citigroup and Bank of America struggled with fixed-income trading, especially in interest rate positions, while Goldman Sachs, Lehman Brothers and Morgan Stanley recorded record gains, largely on interest rate bets.
Inflation reflects itself first in a lowering of the actual rate of interest beneath the natural rate.
FORBES: Why Interest Rates Tell Lies About Inflation, Growth And Just About Everything Else
The discount rate is the interest rate that the central bank charges commercial banks that need to borrow additional reserves.
The second reason for likely interest rate increases can be attributed to the correlation between the Federal Funds Rate and bond interest rates.
The Fed's decision means that the discount rate, the interest rate that the Fed charges to make direct loans to banks will be lowered to 5.75 percent from 6.25 percent.
Another was to use foreign currency: the bank could lend, or accept a bill of exchange, in one currency and collect its debt in another, building a hidden rate of interest into the exchange rate.
应用推荐