Which interest rate pertains to loans between banks and can fluctuate daily?

The Fed Funds Rate is the correct answer because it specifically refers to the interest rate at which banks lend to each other overnight in the U.S. banking system. This rate can fluctuate daily based on supply and demand for reserves, which is influenced by the Federal Reserve's monetary policy actions.

The Federal Reserve, as part of its monetary policy, sets a target for this rate and uses open market operations to maintain the rate within that target range. Changes in the Fed Funds Rate can impact other interest rates in the economy, affecting lending rates for consumers and businesses.

The other options pertain to different contexts: the Discount Rate is the interest rate the Federal Reserve charges banks to borrow funds, which does not fluctuate as frequently as the Fed Funds Rate; the Prime Rate is the interest rate that commercial banks charge their most creditworthy customers, generally based on the Fed Funds Rate but not variably determined daily; and the Base Rate refers to a minimum interest rate set by banks, which is influenced by various factors and not necessarily tied to daily banking transactions.