<P> The official bank rate (also called the Bank of England base rate or BOEBR) is the interest rate that the Bank of England charges Banks for secured overnight lending . It is the British Government's key interest rate for enacting monetary policy . It is more analogous to the US discount rate than to the Federal funds rate . The security for the lending can be any of a list of eligible securities (commonly Gilts) and are transacted as overnight repurchase agreements . Changes are recommended by the Monetary Policy Committee and enacted by the Governor . </P> <P> The official bank rate has existed in various forms since 1694 and has ranged from 0.25% to 17% . The name of this key interest rate has changed over the years . The current name "Official Bank Rate" was introduced in 2006 and replaced the previous title "Repo Rate" (repo is short for repurchase agreement) in 1997 . Previously (between 1981 and 1997) the title was "Minimum Band 1 Dealing Rate" and prior to that the "Minimum Lending Rate". </P>

Bank of england base rate what does it mean