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Discount rate

An interest rate that a central bank charges depository institutions that borrow reserves from it.

📖 Definitions of "Discount rate"

noun
  1. 1

    An interest rate that a central bank charges depository institutions that borrow reserves from it.

  2. 2

    The interest rate used to discount future cashflows of a financial instrument; the annual interest rate used to decrease the amounts of future cashflows to yield their present value.

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