Robust financial systems can increase economic activity and welfare, but instability can disrupt financial activity and impose widespread costs on the economy.Ĭountries use a variety of reporting formats, sample designs, interest compounding formulas, averaging methods, and data presentations for indices and other data series on interest rates. The size and mobility of international capital flows make it increasingly important to monitor the strength of financial systems. At low levels of economic development commercial banks tend to dominate the financial system, while at higher levels domestic stock markets tend to become more active and efficient. The presentation for countries that report data in accordance with its International Financial Statistics (IFS) remains the same.īoth banking and financial systems enhance growth, the main factor in poverty reduction. In 2009 the IMF began publishing a new presentation of monetary statistics for countries that report data in accordance with its Monetary Financial Statistical Manual 2000. The terms and conditions attached to these rates differ by country, however, limiting their comparability. Deposit and lending rates are collected by the International Monetary Fund (IMF) as representative interest rates offered by banks to resident customers. In economies with imperfect markets, or where reported nominal rates are not indicative of effective rates, it may be difficult to obtain data on interest rates that reflect actual market transactions. In some economies interest rates are set by regulation or administrative fiat. Many interest rates coexist in an economy, reflecting competitive conditions, the terms governing loans and deposits, and differences in the position and status of creditors and debtors. International Monetary Fund, International Financial Statistics and data files. This rate is normally differentiated according to creditworthiness of borrowers and objectives of financing. Lending rate is the bank rate that usually meets the short- and medium-term financing needs of the private sector.
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