In the U.S.A. and Canada, a standard interest rate paid by first-class borrowers (companies that have proven to be ideal debtors in the past) to their banks for short-term loans. In the USA, the prime rate has the character of a key interest rate. – If the prime rate rises, companies must consequently pay higher interest rates, which CETERIS PARIBUS depresses earning power. As a result, the companies’ share prices usually fall. – A falling prime rate usually has the opposite, positive effect on the stock market – see prime rate, prime rate, interest rate pass-through.
Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent!
University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/