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Basis point (bp)

One hundredth of a percentage point: 0.01%.

Macro & RatesBeginner

Definition

Interest rates and yields are quoted in basis points. A 25 basis point rate hike raises a rate by 0.25 percentage points; 100 basis points equal 1 percentage point.

Example

Hypothetical exampleIf the 10-year yield moves from 4.00% to 4.35%, it rose 35 basis points.

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