Wall Street Journal prime rate

The Wall Street Journal Prime Rate (WSJ Prime Rate) is a measure of the U.S. prime rate, defined by The Wall Street Journal (WSJ) as "the base rate on corporate loans posted by at least 70% of the 10 largest U.S. banks". It is not the "best" rate offered by banks. It should not be confused with the discount rate set by the Federal Reserve, though these two rates often move in tandem.

The print edition of the WSJ is generally the official source of the prime rate. The Wall Street Journal prime rate is considered a trailing economic indicator. Many (if not most) lenders specify this as their source of this index and set their prime rates according to the rates published in the Wall Street Journal. Because most consumer interest rates are based upon the Wall Street Journal Prime Rate, when this rate changes, most consumers can expect to see the interest rates of credit cards, auto loans and other consumer debt change.

The prime rate does not change at regular intervals. It changes only when the nation's "largest banks" decide on the need to raise, or lower, their "base rate". The prime rate may not change for years, but it has also changed several times in a single year.