Prior to 2003, the Federal Reserve charged the ______ when loaning money directly to banks, and thereby, to signal its intentions.

Question

Quizplus · Accepted Answer

Prior to 2003, the Federal Reserve charged the discount rate when loaning money directly to banks, which was a key tool for the Fed to signal its intentions and influence the overall economy. The discount rate refers to the interest rate at which banks can borrow funds from the Fed directly, and changes to this rate can affect the cost of borrowing for banks, which can trickle down to impact consumer borrowing and spending.

Prior to 2003, the Federal Reserve Charged the ______ When