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Is the Prime Rate the main benchmark interest rate for the United States?

April 26, 2017benchmark Interest rate main Prime rate united states

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Is the Prime Rate the main benchmark interest rate for the United States?

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No, it isn’t. The main, benchmark interest rate in the United States is the Federal Reserve’s target for the fed funds rate. The fed funds rate is basically a healthy bank’s cost for borrowing overnight funds from other banks via the Federal Reserve System. The U.S. Prime Rate is invariably 300 basis points (3.00 percentage points) above the Fed Funds Target Rate.