What are the federal regulations for interest rates?

Interest rates are regulated by the Federal Reserve System, which sets rules and regulations for banks in all 50 states, including Delaware. Interest rates are used to control the supply of money and credit in the economy, and they affect how much people spend and save. The Federal Reserve System controls interest rates through the Federal Funds Rate. This is the rate at which banks lend to each other overnight and it is the most important rate in the banking system. When the Federal Reserve wants to increase the amount of money circulating in the economy, it lowers the Federal Funds Rate. When the Federal Reserve wants to slow spending, it raises the rate. The Federal Reserve also sets Regulation D, which limits the amount of interest a bank can pay on deposits. Banks must follow this regulation to avoid paying out too much of their profits in interest. As of December 2019, banks in Delaware were limited to paying a maximum of 0.50% interest on checking and savings accounts. Each state in the United States is also responsible for setting its own regulations for consumer lending. Different states may have different laws and regulations regarding the maximum amount of interest a bank can charge on consumer loans. In Delaware, the maximum allowable interest rate on a loan is 16% for a consumer loan or 6% for a mortgage.

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What are the federal regulations for interest rates?

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