Market Interest Rate
Short definition
A market interest rate is the traded yield on bills, swaps and money markets. Its gap to the policy rate carries liquidity, expectations and risk premium.
Detailed explanation
TLREF, the bond curve and the IRS curve are different markets. Treasury, the loan fix and the WACC risk-free rate are picked from those curves; mixing them breaks Kd.
Global rates (Fed, BOJ) shift the local curve via CDS and capital flows. “Is our rate set in New York?” lives on that channel.
Why it matters for the CFO
The loan price is market reference plus spread. If the market fix jumps while policy is unchanged, all-in still moves.
How to read it
A steeper curve dearens long refinancing. The short end carries policy; the long end inflation and sovereign risk.
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Definitions are educational. They are not investment, credit or tax advice.