Prime Rate
Definition
A reference lending rate set by a financial institution, often used to price variable-rate loans and credit lines.
Canada
How does Canada’s prime rate relate to the Bank of Canada rate?
Each lender sets its own prime rate, and changes in the Bank of Canada’s policy rate often influence it. If your line of credit charges prime plus two percentage points and prime falls from 6% to 5.75%, your rate falls from 8% to 7.75%, assuming your spread stays the same.
Bank of Canada