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Interbank lending rates fall to 14-month low
The interbank rate is the interest charged on short-term loans made between financial institutions. The term "interbank rate" may also refer to the foreign exchange rates paid by banks when they trade currencies with other banks.
By Isaac OGANGA
The interbank rate fell to 10.4998 percent on Thursday last week –the lowest level since December 2023– on the back of the CBK cutting its key lending rate to 10.75 percent earlier this month from 11.25 percent previously.
The interbank lending market is a market in which banks lend funds to one another for a specified term. Most interbank loans are for maturities of one week or less, the majority being overnight. Such loans are made at the interbank rate (also called the overnight rate if the term of the loan is overnight).