Policy rate, percent in the United Kingdom, January 2000 - March 2022:
For that indicator, we provide data for the United Kingdom from January 2000 to March 2022. The average value for the United Kingdom during that period was 2.19 percent with a minimum of 0.1 percent in March 2020 and a maximum of 6 percent in February 2000.
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around the world.
Longer historical series
* indicates monthly or quarterly data series
Source: Bank for International Settlements (BIS)
Definition: The interest rate which best captures the monetary authorities' policy intentions. Different countries have different policy interest rates. The most common are the overnight lending rate, discount rate and repurchase rate (of different maturities).
In the USA the policy rate is the federal funds rate. The federal funds rate is the interest rate at which depository institutions trade federal funds (balances held at Federal Reserve Banks) with each other overnight. The federal funds rate is essentially determined by the market but is influenced by the Federal Reserve through open market operations to reach the federal funds rate target.
In the Euro area the policy rate is the main refinancing operations rate. The main refinancing operations (MRO) rate is the interest rate banks pay when they borrow money from the ECB for one week. When they do this, they have to provide collateral to guarantee that the money will be paid back.
The policy interest rates determine the levels of the rest of the interest rates in the economy, since it is the price at which private agents (mostly private banks) obtain money from the central bank.