This week the government placed three-month treasury bills in the local market at an interest rate of 8.5%, down from 16% in November.
Keep in mind that municipal securities are subject to a number of risks including, but not limited to: Interest Rate Risk, the risk that the market value of fixed-income securities may fluctuate when interest rates change, and Prepayment Risk, the risk that the issuers of individual securities may prepay them at a time when interest rates have declined.
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For this group, a common factor in most plans is the utilization of a current market interest rate to convert the monthly pension to a lump sum figure.
All the same, the usually predictive Fed-funds futures market is pointing to another interest-rate cut of half a percentage point at the Fed meeting at the end of this month.
Take, for example, one indicator of the market's appetite for risk, the spread between swaps of fixed- and floating-rate interest payments (see chart).
The futures market was pricing in some chance of an interest-rate hike before the year is out.
Last year the loan to finance the sale of its bad assets was switched to a market interest rate.
As soon as November 1996, Moscow plans to go to market with an initial Eurobond offering and expects to receive an interest rate of only 300-350 basis points (3-3.5%) above comparable U.S. Treasury bonds.
For one thing, it is hard to know how much companies have in fact lengthened the maturity of their debts because the interest-rate swap market allows them to swap those fixed bond payments into cheaper floating debt, a popular strategy in the investment-grade market.
In terms of capital markets, interest rate liberalization and a more market-oriented exchange rate are central.
In theory, the prices of various securities should have converged around a general market interest rate.
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However, all that a year of austerity did for Greece was to raise the market interest rate on its 10-year bonds from 10.5% to 16.8%.
Before 2007 the government created an artificial housing and economic bubble by encouraging home buying through a combination of 0% down payments and allowing below-market interest rate mortgages.
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All this high-flying adventure--plus some bad bets on Harvard's part in the interest-rate swap market that had apparently been the brainchild of former university president Lawrence Summers--created a perfect financial storm.
It may come as a shock to some, but just like everything else in a free market, interest rate levels are best determined by the freely interacting forces of supply and demand.
For what has been happening is that the ECB has been buying bonds in the open markets as a way of reducing the interest rate that Greece must pay on market borrowings.
"The recent slowing down in monthly house price inflation, together with further evidence of moderation in housing market activity, suggest that the interest rate rises since last summer are having an impact on the market, " said the Halifax's chief economist Martin Ellis.
It is helpful, however, to get over the idea that interest rate targeting precludes a range of possibilities in open market operations.
The dollar stumbled after the release of the minutes of the December meeting of the Federal Open Market Committee, which signalled that interest-rate rises may be nearing an end.
In such a market, anyone can borrow or lend as much as they want at the going rate of interest.
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Hopes of a halt to further interest rate hikes also spurred the bond market, with the yield on the ten-year Treasury falling .071 to 5.059%.
The project is the brainchild of Richard Sandor, a former economist with the Chicago Board of Trade, best known for founding the international market in interest-rate derivatives.
"The market there started to decline not just because of government measures but because of seven interest rate hikes in 12 months, " says Gin.
Tim Lord cited alleged communications from the "31st floor" of Barclays HQ - which housed senior executives - about the benchmark market interest rate.
Market expectations are for the Selic benchmark interest rate to hit 7.50 percent before the end of the year.
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In our negative real interest rate environment, the market has begun to put a premium on the certainty of income.
Observers of America's Federal Reserve picked over the minutes of November's Federal Open Market Committee meeting and predicted that the central bank will soon end its cycle of interest-rate rises.
These pay roughly the same interest rate as the money-market accounts it previously used, but offer the benefit of federal deposit insurance.
The sub-prime lending market - worth billions of pounds - involves lending to people with poor credit records at an interest rate premium.
Minutes from the latest meeting of the Federal Open Market Committee, the central-bank panel that sets interest-rate policy, indicate a rate-cut idea has been around for a while.
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