PFCs are most notable because they determine annual percentage rate (APR) of a loan. Lenders are required by law to disclose APR. This is a good idea in concept, but not so simple in practice.

Here’s how the central bank’s interest rate stance influences car loans, credit cards, mortgages, savings and student loans.

The interest rate on a mortgage indicates how much interest you’ll pay for the amount you borrow. The annual percentage rate ...