Key rate: what is it and why is it important? 💸🤔
Let's figure out what the key rate is, but in simple terms! This is the percentage at which banks borrow money from the Central Bank. This figure affects everything: from the cost of a loan to economic growth.
Example from the USA 🇺🇸:
When the economy slows down, the Federal Reserve System (FRS) lowers the rate. For example, during the COVID-19 pandemic, the rate was almost 0% to support people and businesses.
The result? Loans became cheap, more people were able to buy houses 🏠 or start a business 💼.
But if inflation rises, the Fed raises the rate — loans become more expensive, the economy "cools" a little. 🌡️
Why is this important?
For business: cheap loans = new projects and growth. 📈
For us: mortgages, cars, education — everything becomes more accessible. 🚗💡
The key rate is like a lever that regulates the economy. The lower it is, the easier it is to get a loan. Would you like to live with low or high rates? Share in the comments! 💬👇