This kind of loan interest rate usually appears in private loan companies or private lending. If it is not an urgent need for funds, users are advised not to borrow money in this way to prevent overdue repayment caused by excessive interest rates.
The annual interest rate refers to the deposit interest rate for one year. Interest rate is the abbreviation of "interest rate", which refers to the ratio of interest amount to deposit principal or loan principal in a certain period. Usually divided into annual interest rate, monthly interest rate and daily interest rate. The annual interest rate is expressed as a percentage of the principal, the monthly interest rate as a percentage, and the daily interest rate as a percentage.
When the economic development is in the growth stage, the investment opportunities of banks increase, the demand for loanable funds increases, and interest rates rise. On the contrary, when the economy is in a downturn and the society is in a depression stage, banks' willingness to invest is reduced, loanable funds's demand is reduced, and the market interest rate is generally low.
Factors affecting the annual interest rate:
1, macroeconomic environment
When the economic development is in the growth stage, the investment opportunities of banks increase, the demand in loanable funds increases and the interest rate rises; On the other hand, when the economy is in a downturn and the society is in a depression, banks' willingness to invest will decrease, so will the demand for loanable funds, and the market interest rate will generally be lower.
2. Policies of the Central Bank
Generally speaking, when the central bank expands the money supply, the total supply in loanable funds will increase, the supply exceeds demand, and the natural interest rate will decrease accordingly; On the contrary, the central bank implements a tight monetary policy, reducing the money supply, so that loanable funds's demand exceeds supply, and interest rates will rise accordingly.
3. Price level
Market interest rate is the sum of real interest rate and inflation rate. When the price level rises, the market interest rate also rises accordingly, otherwise the real interest rate may be negative. At the same time, due to rising prices, the public's willingness to deposit will decrease, while the loan demand of industrial and commercial enterprises will increase. The imbalance between deposit and loan caused by loan demand exceeding loan supply will inevitably lead to an increase in interest rates.
4. Stock and bond markets
If the securities market is on the rise, the market interest rate will rise; On the contrary, interest rates are relatively low.
5. International economic situation
Changes in a country's economic parameters, especially the exchange rate and interest rate, will also affect the fluctuation of interest rates in other countries. Naturally, the rise and fall of the international securities market will also bring risks to the interest rates faced by international banking business.