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RBA Glossary definition for interest rate

interest rate – The term used to describe the cost of borrowing money or the return to the owner of the funds which are invested or lent out. It is usually expressed as a percent per annum of the amount of money borrowed, lent or invested.

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Appendix 2: Regressions Using the Change in Interest Rates

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
RDP 9206: Loan Rate Stickiness: Theory and Evidence Appendix 2: Regressions Using the Change in Interest Rates. ... Download the Paper 820. KB. REGRESSIONS USING THE CHANGE IN INTEREST RATES.
https://www.rba.gov.au/publications/rdp/1992/9206/appendix-2.html

Appendix 1: Data

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
The deposit categories and corresponding interest rates, along with their source are listed below. ... The prime rate is from the Bank of Canada Review, Table F1 “Financial Market Statistics”, Chartered Banks Administered Interest Rates – Prime
https://www.rba.gov.au/publications/rdp/1992/9206/appendix-1.html

Tests of Loan Rate Stickiness

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
Nevertheless, there are observable interest rates which provide satisfactory proxies. These are the bank bill rate and the certificate of deposit rate (CD rate). ... Its advantage is that it uses a wider range of interest rates than any single interest
https://www.rba.gov.au/publications/rdp/1992/9206/tests-of-loan-rate-stickiness.html

Loan Rate Stickiness: Theory and Evidence

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
Research Discussion Papers contain the results of economic research within the Reserve Bank
https://www.rba.gov.au/publications/rdp/1992/9206.html

Loan Rate Stickiness: Theory and Evidence

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
Research Discussion Paper – RDP 9206 Loan Rate Stickiness: Theory and Evidence.
https://www.rba.gov.au/publications/rdp/1992/9206/

Introduction

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
In contrast to the bulk of studies on interest rate stickiness, we examine the behaviour of a number of different Australian lending rates. ... For purposes of comparison, we also examine the behaviour of a number of interest rates in other countries.
https://www.rba.gov.au/publications/rdp/1992/9206/introduction.html

References

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
2559. Gittins, Ross, “Bank Rates May Not Be in Your Interest”, Sydney Morning Herald, Nov. ... 1991. Reserve Bank of Australia, “Bank Interest Rate Margins”, Reserve Bank of Australia Bulletin, May 1992, 1–6.
https://www.rba.gov.au/publications/rdp/1992/9206/references.html

Theories of Loan Rate Stickiness

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
Alternatively, faced with higher interest rates, firms may decide to undertake riskier projects (moral hazard). ... Given that the borrower is risk averse, she prefers stable interest rate payments.
https://www.rba.gov.au/publications/rdp/1992/9206/theories-of-loan-rate-stickiness.html

Summary and Conclusions

1 Jun 1992 RDP 9206
Philip Lowe and Thomas Rohling
For the housing loan rate, switching costs and risk sharing appear to be important causes of the interest rate stickiness. ... Evidence from the standard or most commonly charged rate to small business borrowers suggests some interest rate stickiness.
https://www.rba.gov.au/publications/rdp/1992/9206/summary-and-conclusions.html