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What is Interest Rate Corridor?
The band between a central bank's lending and borrowing rates; it gives monetary policy flexibility.
ExampleNarrowing the interest rate corridor showed that monetary policy had become clearer.The figures in the example illustrate the concept; they are not current market data.
Related terms
Central BankThe official institution that sets monetary policy, manages interest rates and supervises the financialDiscount Rate (Central Bank)The interest rate a central bank charges when lending to commercial banks.Monetary TighteningCentral bank policy aimed at fighting inflation by raising rates and reducing liquidity.InflationThe rise in the general price level over time and the resulting loss of money's purchasing power.
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Frequently asked questions
What is Interest Rate Corridor?
The band between a central bank's lending and borrowing rates; it gives monetary policy flexibility.
What is Interest Rate Corridor called in Turkish?
In Turkish financial reporting and news, Interest Rate Corridor is called Faiz Koridoru.
Which concepts are related to Interest Rate Corridor?
The concepts most often mentioned together with Interest Rate Corridor are Central Bank and Discount Rate (Central Bank).