Corporate borrowing rates are much higher.
The portfolio selection with superior assets on restriction of the borrowing rate is discussed.
The lowest deposit rate set by the central bank ACTS as a floor for short-term interest rates in money markets and for borrowing rates generally.
Risk aversion, fear of default and depleted bank capital have caused private borrowing rates to deviate sharply from policy rates.
One way or another, the BoJ should have a clearer idea about how much people have been spending—and whether to risk raising its key borrowing rate—from late January onwards.
This paper is mainly about the portfolio choice with borrowing rate higher than deposit rate when the investor invests into a project.
On Wednesday India's central bank raised a key short-term borrowing rate by a quarter percentage point to 8.0%.
We said borrowing rates weren't likely to go up all that much. The spread between credit card rates and the Fed's interest rate was already quite large.
That would lower their funding costs and in turn bring down borrowing rates for small businesses.
Portugal's borrowing rates jumped, too (see chart 1).
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