By Klavs Valters
A central bank’s interest rate is a rate at which it typically lends money to local banks. This interest rate is charged by nations’ central or federal banks on loan advances to control the money supply in the economy and the banking sector.
Each central bank has its own annual schedule when announcing its rates. In the trading world, it’s prudent to keep a tab on these announcements as it impacts market volatility if there is a sudden interest rate rise or fall.
These rates also have an impact on everyday life, as they often determine what you pay for borrowing money, as well as what the bank will pay you for saving money.
Recent Rate Hikes
The most recent rate hike came from the US Federal Reserve back in March 2018, when it increased its rates from 1.5% to 1.75%. Additionally, the Federal Reserve also signalled its intention to further raise this rate in the future. This has been the sixth time the US Federal Reserve has raised its interest rates since the 2008 financial crisis.
Bank of Canada increased its key interest rates back in January by 0.25% to 1.25% while quoting a number of upbeat news stories, including an economy that is running flat-out, healthy job gains, and the lowest unemployment rate in over 40 years. This has been Bank of Canada’s third rate hike since the summer of 2017, and the first time the overnight rate has been above 1% since 2009.
Current Bank Interest Rates
Central Bank Interest Rate Announcement Timetable for 2018
To keep up to date with other news announcements, visit our ‘Economic Calendar’ section on our website – https://www.gomarkets.com.au/economic-calendar/