Recent Examples of basis point from the Web
The yield on the 10-year Treasury, which mortgage rates follow loosely, jumped more than 10 basis points in two days.
Card rates are based on a bank’s prime rate, which is usually set at 300 basis points, or three percentage points, above the high end of the Fed’s benchmark.
Although the Fed raised interest rates by 25 basis points last week, the central bank didn’t revise its long term views on inflation and stuck to earlier projections of three rate increases next year.
At the time, the Fed had raised rates by 75 basis points over the prior two years, while savings account interest rates had barely budged.
The central bank in Prague will lift the benchmark rate by 25 basis points to 0.5 percent on Thursday, according to 22 out of 23 economists surveyed by Bloomberg.
Bahrain’s debt risk, measured by five-year credit default swaps, has dropped more than 60 basis points to 241 as of Tuesday, according to data compiled by Bloomberg.
The company, which owns ad agencies like McCann and FCB, is revising its financial targets for the year, to 40 basis points of operating profit margin growth and 1% to 2% organic growth for the full year.
Grant noted that a senior unsecured bond, due in 2022, issued by Carrefour S.A., the world’s second-largest food retailer after Walmart, yields just 50 basis points, or half of 1 percent annually.
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First Known Use of basis point
Financial Definition of BASIS POINT
What It Is
A basis point is one hundredth of one percent.
How It Works
There are one hundred basis points in one percent.
Let's say Bank XYZ pays 2.54% interest on its savings accounts. A month later, it raises the rate to 2.75%. We would say that rate increased by 21 basis points.
Why It Matters
Basis points are in anything that is expressed as a percentage: interest rates, rates of return, bond coupons, rates of change and much more. Because tiny changes can have big effects, it is no surprise that the markets are concerned about hundredths of a percent.
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