The key interest rate is the rate at which banks can borrow money from a central bank within their currency area. This rate represents the cost of lending money borne by commercial banks. In Switzerland, the key interest rate is set by the Swiss National Bank (SNB), whose primary mission is to ensure price stability. The SNB utilizes the key interest rate to this end, increasing the rate at times to make borrowing more expensive for banks. Banks pass these costs on to borrowers, which means it becomes more expensive for private individuals and companies to borrow. This leads to declining demand for credit, curbing consumer and capital expenditure. Conversely, the SNB may lower interest rates, which has the opposite effect. Borrowing then becomes generally less costly, which tends to fuel consumer and capital expenditure. The key interest rate is thus an important instrument of monetary policy, employed to stabilize prices, i.e. keep inflation under control.