The Base Rate, or base interest rate, is the interest rate that a central bank, like the Bank of England or Federal Reserve, will charge to lend money to commercial banks. The purpose of the base rate is to keep prices stable and promote economic growth. It also serves as a benchmark for other rates in the economy.The current base rate in the United States is 0.25%. This means that commercial banks can borrow money from the Federal Reserve at this interest rate. The Federal Reserve sets this interest rate based on its assessment of economic conditions and inflationary pressures.The impact of changes in the base rate can be significant for businesses and consumers alike. When it goes up, borrowing becomes more expensive and it can slow down economic growth; when it goes down, borrowing becomes cheaper and stimulates spending and investment.
