TRADING GLOSSARY
Discount rate
In central banking, the discount rate is the interest rate charged on certain central-bank loans to eligible banks, with terminology varying by jurisdiction. In valuation, the same term means the rate used to convert future cash flows into present value.
EXAMPLE
In a hypothetical policy change, a central bank raises its lending-facility rate, making borrowing through that facility more expensive for eligible banks.
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Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Glossary definitions are general education only and are not investment advice. Risk disclosure