Interest rates

Overnight market

The overnight market is the component of the money market involving the shortest term loan. The overnight market is primarily used by banks and other financial institutions. Lenders agree to lend borrowers funds only "overnight" i.e. the borrower must repay the borrowed funds plus interest at the start of business the next day. Given the short period of the loan, the interest rate charged in the overnight market, known as the overnight rate is, generally speaking, the lowest rate at which banks lend money. Most of the activity in the so-called overnight market in fact occurs in the morning immediately after the start of business for the day. Banks and financial institutions analyse their cash reserves on a daily basis, and assess whether they have an excess or a deficit of cash with respect to their needs. More specifically, deposit-taking financial institutions (such as banks) begins with forecasting the institution's and its clients' liquidity needs over the course of that day. If this projection is that the institutions' clients will need more money over the course of the day than the institution has on hand, the institution will borrow money on the market that day. On the other hand, if the analyst projects that the institution will have surplus money on hand beyond that needed by its clients that day, then it will lend money on the overnight market that day. In this context, the term "overnight" means that the cash borrowed is repaid the following day. The bulk of trading occurs in the morning and is based on these projections. If, however, over the course of the day, the actual amount of money required by the institution's clients departs from that projected in the morning, it may become necessary for the institution to borrow money on the overnight market to meet this unexpected demand from its clients; conversely, if the institution finds itself with more funds on hand than it anticipated late in the day, it will then lend those funds on the overnight market. The overnight rate fluctuates over the course of a business day, depending on the amount of money demanded from and supplied to the overnight market over the course of the day. The rate quoted as the "overnight rate" may be the rate at the end of the day, or an average of the rate over the course of the day. Banks are the largest participant in the overnight market, although some other large financial institutions, e.g. mutual funds, also buy and sell on the overnight market as a way to manage unanticipated cash needs or as a temporary haven for money until the institution can decide on where to invest that money. (Wikipedia).

Video thumbnail

Indian Railways Best Advertisement

This is one of the Indian Railways Best Advertisement Watch & Share :)

From playlist We are like this only

Video thumbnail

New York City 4K - Night Drive - Times Square - Driving Downtown

Times Square, referred to as "The Crossroads of the World", and "The Center of the Universe", is one of the world's busiest pedestrian areas with an estimated 50 million visitors per year. Times Square is a major commercial intersection, tourist destination, entertainment center and neigh

From playlist Location by City - New York City - J Utah

Video thumbnail

After Dark Online | Exploratorium

Every Thursday Night • 7:00–8:00 p.m See for Yourself From our home to yours, we’re transmitting digital dispatches from After Dark at the Exploratorium. Tune in each week for a revue of thoughtful and innovative science, arts and perceptual experiences. From compelling conversation and

From playlist After Dark Online | Thursday Nights | Exploratorium

Video thumbnail

Las Vegas 4K - America's Playground - Skyline Sunrise

Sunday morning drive on the Las Vegas Strip at 530am on a Sunday morning. The video starts south of the strip by the airport and ends at the north end by the original downtown area of Las Vegas. I got in late Saturday night on my last trip about 9 months ago. I'm scheduled to go to Eu

From playlist Time of Day - Sunrise Drive - J Utah

Video thumbnail

Weekly Space Hangout - Apr 7, 2017: Weekly News Roundup!

We record the Weekly Space Hangout every Friday at 12:00 pm Pacific / 3:00 pm Eastern. You can watch us live on Universe Today or the Universe Today YouTube page.

From playlist Weekly Space Hangout

Video thumbnail

After Dark: Extended Cinemas

Join us for an exploration of new frontiers in film—where cinematic artworks range beyond the screen to encompass unique combinations of animation, objects, and live performance. To learn more about Exploratorium After Dark visit: http://www.exploratorium.edu/afterdark/

From playlist After Dark | Thursday Nights at the Exploratorium

Video thumbnail

Coffee, Mesmerism, and Morning Routines | Idea Channel | PBS Digital Studios

Viewers like you help make PBS (Thank you 😃) . Support your local PBS Member Station here: https://to.pbs.org/donateidea Tweet us! http://bit.ly/pbsideachanneltwitter Idea Channel Facebook! http://bit.ly/pbsideachannelfacebook Talk about this episode on reddit! http://bit.ly/pbsideachanne

From playlist Hungry for More?

Video thumbnail

From replacement reference rates to funding gaps: The LIBOR transition so far

"A secured overnight rate does not reflect the cost of funding for financial institutions over the medium term. So you'll have a bit of a dilemma if you're the treasurer of the bank." Federico Galizia, Chief Risk Officer, Inter-American Development Bank (IDB), explores the current and fut

From playlist CRO forum

Video thumbnail

Fed Open Market Operations

Courses on Khan Academy are always 100% free. Start practicing—and saving your progress—now: https://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/federal-reserve/v/fed-open-market-operations Fed Open Market Operations More free lessons at: http://www.khanac

From playlist Money, banking and central banks | Finance and Capital Markets | Khan Academy

Video thumbnail

Banking 14: Fed Funds Rate

How open market operations effect the rate at which banks lend to each other overnight. More free lessons at: http://www.khanacademy.org/video?v=IniG1KkPS2c

From playlist Banking and Money

Video thumbnail

International Time Zones (1 of 2: Why do we need them?)

More resources available at www.misterwootube.com

From playlist Time

Video thumbnail

The Fed's Money "Printing" Explained

You can now support me on https://www.patreon.com/thehatedone and get access to more exclusive content. The U.S. Federal Reserve creates free money for those who are "creditworthy", which artificially raises their wealth, indebts the poor, and inflates money on people's savings. It's tim

From playlist Decrypted Lies

Video thumbnail

Quantitative easing | Money, banking and central banks | Finance & Capital Markets | Khan Academy

Courses on Khan Academy are always 100% free. Start practicing—and saving your progress—now: https://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/federal-reserve/v/quantitative-easing Overview of quantitative easing. Created by Sal Khan. Watch the next les

From playlist Money, banking and central banks | Finance and Capital Markets | Khan Academy

Video thumbnail

Understanding the Pattern Day Trader Rule (PDT) for Day Traders

Want to Learn More ❓❓ Get info on My Strategy and Courses here: https://www.warriortrading.com/strategy/ 📈 Before we continue...👀 💰Remember, day trading is risky and most traders lose money. You should never trade with money you can’t afford to lose. Prove profitability in a simulator be

From playlist Warrior Trading: Day Trading Terminology

Video thumbnail

EEVblog #73 - How to screw up your winning product

Another random drive-time rant. Dave rants about how dickhead marketing changes can screw up your winning product. The Tropicana Story: http://www.businessweek.com/the_thread/brandnewday/archives/2009/04/tropicana_fiasc.html and http://www.fastcompany.com/blog/linda-tischler/design-

From playlist DriveTime Rant

Video thumbnail

More on Quantitative Easing (and Credit Easing)

Courses on Khan Academy are always 100% free. Start practicing—and saving your progress—now: https://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/federal-reserve/v/more-on-quantitative-easing-and-credit-easing Understanding the difference between quantitati

From playlist Money, banking and central banks | Finance and Capital Markets | Khan Academy

Video thumbnail

Stanford Engineering Hero Lecture - Craig Barrett

"Research Universities, Technology Innovation and 21st Century Competitiveness" - Craig Barrett, retired CEO and chairman of semiconductor giant Intel Corp. We know that market shares are won and lost during periods of transition. The world's biggest economic transition, the arrival of 3

From playlist Stanford Engineering Hero Lectures

Video thumbnail

Stanford Engineering Hero: Craig Barrett

Craig Barrett, former Chair and CEO of Intel, was once a professor of materials science and engineering at Stanford. He recently became one of the handful of eminent faculty and alumni of the school to be inaugurated as Stanford Engineering Heroes. This is the lecture he gave on his "Hero

From playlist Stanford Engineering Heroes

Video thumbnail

What Is the Sunday Evening Feeling?

Sunday evenings have a particular atmosphere, where nostalgia mixes with dread. A lot of the emotion is at heart about a background sense that we haven’t found the meaning of our lives – and that time is running out for us. For gifts and more from The School of Life, visit our online shop:

From playlist WORK + CAPITALISM

Related pages

Overnight rate