expression

rate cut

a decrease in interest rates

In From the Business Pages

In more detail

1. (noun) a reduction in interest rates set by a central bank, making it cheaper to borrow money

2. (noun) a reduction in a price or fee

Examples

1. The Federal Reserve announced a rate cut to help the economy during the recession.
2. The store offered a rate cut on memberships to attract new customers.

How to use rate cut

Rate cut most commonly refers to central bank decisions to lower interest rates, affecting borrowing costs across an economy; this usage is frequent in financial news and policy discussions. It can also refer to reductions in prices or fees more generally, though this sense is less common in formal financial contexts. The term is typically used in contexts where lowered rates or prices are expected to stimulate spending, investment, or economic activity.

Common phrases

announce a rate cut
expect a rate cut
central bank rate cut
multiple rate cuts
aggressive rate cuts
rate cut cycle

Synonyms

interest rate reduction · rate decrease · price reduction · discount · markdown

Opposites

rate increase · rate hike · price increase

Word family

cut (verb) · cuts (plural) · cutting (gerund)

A common mistake

Learners sometimes confuse 'rate cut' with 'rate cut' by assuming it always refers only to interest rates rather than recognizing its broader application to any fee or price reduction.

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