loans
prime rate
The interest rate that commercial banks charge their most creditworthy customers, which influences rates across the economy.
Example
"When the Federal Reserve raised rates, the prime rate increased and mortgages became more expensive."
💡 Memory Tip
PRIME = best. The prime rate is the BEST (lowest) rate banks offer their top customers.
Etymology
Prime (first, best) + rate — the best (lowest) rate offered to top customers.
Common Misspellings
prime reteprime ratprimerateprime ratee