The Federal Reserve Bank ("The Fed") sets the base rate (i.e. the "overnight rate") from which commercial banks can borrow. Those banks, in turn, lend to debtors of all sorts, adding various risk premiums to the interest rates along the way.
Sounds similar with a base reference rate + lender's margin (in finland currently like 0.2-0.5% for house loans), but for some reason the base rates are positive in the us?
After 2008 in europe the rates took a dive and have been negative for a few years.
After 2008 in europe the rates took a dive and have been negative for a few years.