Federal Funds Effective Rate (FEDFUNDS) - FRED

The federal funds rate is the interest rate at which depository institutions trade federal funds (balances held at Federal Reserve Banks) with each other ... Skiptomaincontent EconomicResearchResources ExploreresourcesprovidedbytheResearchDivisionattheFederalReserveBankofSt.Louis research.stlouisfed.org ResearchNews Economists Publications WorkingPapers InformationServices SwitchProducts FRED AL FRED FRASER ECONLOWDOWN ReleaseCalendar FREDTools FREDBlog FREDNews AboutFRED MyAccount SwitchProducts EconomicResearchResources ExploreresourcesprovidedbytheResearchDivisionattheFederalReserveBankofSt.Louis. AboutFRED WhatisFRED Tutorials DataLiteracy ContactUs FREDTools FREDAdd-inforExcel FREDAPI FREDMobileApps EconomicResearchResources ResearchNews Economists Publications WorkingPapers InformationServices SwitchProducts FRED AL FRED FRASER ECONLOWDOWN Yourtrusteddatasourcesince1991. ReleaseCalendar FREDTools FREDAdd-inforExcel FREDAPI FREDMobileApps FREDNews FREDBlog AboutFRED WhatisFRED Tutorials DataLiteracy ContactUs Categories>Money,Banking,&Finance>InterestRates>FRBRates-discount,fedfunds,primarycredit FederalFundsEffectiveRate(FEDFUNDS) Jul2022:1.68| Percent| Monthly| Updated:Aug1,2022 Observation: Jul2022: 1.68 (+more)  Updated: Aug1,2022 Jul2022:  1.68   Jun2022:  1.21   May2022:  0.77   Apr2022:  0.33   Mar2022:  0.20   ViewAll Units: Percent,NotSeasonallyAdjusted Frequency: Monthly 1Y| 5Y| 10Y| Max From to Date: Datainthisgrapharecopyrighted.Pleasereviewthecopyrightinformationintheseriesnotesbeforesharing. ShareLinks  PageshortURL Embedinwebsite ImageshortURL AccountTools  Addtodatalist Getemailnotification NOTES Source: BoardofGovernorsoftheFederalReserveSystem(US)   Release: H.15SelectedInterestRates   Units:  Percent, NotSeasonallyAdjusted Frequency:  Monthly Notes: Averagesofdailyfigures.Foradditionalhistoricalfederalfundsratedata,pleaseseeDailyFederalFundsRatefrom1928-1954.Thefederalfundsrateistheinterestrateatwhichdepositoryinstitutionstradefederalfunds(balancesheldatFederalReserveBanks)witheachotherovernight.Whenadepositoryinstitutionhassurplusbalancesinitsreserveaccount,itlendstootherbanksinneedoflargerbalances.Insimplerterms,abankwithexcesscash,whichisoftenreferredtoasliquidity,willlendtoanotherbankthatneedstoquicklyraiseliquidity.(1)Theratethattheborrowinginstitutionpaystothelendinginstitutionisdeterminedbetweenthetwobanks;theweightedaveragerateforallofthesetypesofnegotiationsiscalledtheeffectivefederalfundsrate.(2)TheeffectivefederalfundsrateisessentiallydeterminedbythemarketbutisinfluencedbytheFederalReservethroughopenmarketoperationstoreachthefederalfundsratetarget.(2)TheFederalOpenMarketCommittee(FOMC)meetseighttimesayeartodeterminethefederalfundstargetrate.Aspreviouslystated,thisrateinfluencestheeffectivefederalfundsratethroughopenmarketoperationsorbybuyingandsellingofgovernmentbonds(governmentdebt).(2)Morespecifically,theFederalReservedecreasesliquiditybysellinggovernmentbonds,therebyraisingthefederalfundsratebecausebankshavelessliquiditytotradewithotherbanks.Similarly,theFederalReservecanincreaseliquiditybybuyinggovernmentbonds,decreasingthefederalfundsratebecausebankshaveexcessliquidityfortrade.WhethertheFederalReservewantstobuyorsellbondsdependsonthestateoftheeconomy.IftheFOMCbelievestheeconomyisgrowingtoofastandinflationpressuresareinconsistentwiththedualmandateoftheFederalReserve,theCommitteemaysetahigherfederalfundsratetargettotempereconomicactivity.Intheopposingscenario,theFOMCmaysetalowerfederalfundsratetargettospurgreatereconomicactivity.Therefore,theFOMCmustobservethecurrentstateoftheeconomytodeterminethebestcourseofmonetarypolicythatwillmaximizeeconomicgrowthwhileadheringtothedualmandatesetforthbyCongress.Inmakingitsmonetarypolicydecisions,theFOMCconsidersawealthofeconomicdata,suchas:trendsinpricesandwages,employment,consumerspendingandincome,businessinvestments,andforeignexchangemarkets.ThefederalfundsrateisthecentralinterestrateintheU.S.financialmarket.Itinfluencesotherinterestratessuchastheprimerate,whichistheratebankschargetheircustomerswithhighercreditratings.Additionally,thefederalfundsrateindirectlyinfluenceslonger-terminterestratessuchasmortgages,loans,andsavings,allofwhichareveryimportanttoconsumerwealthandconfidence.(2)References(1)FederalReserveBankofNewYork."Federalfunds."Fedpoints,August2007.(2)BoardofGovernorsoftheFederalReserveSystem."MonetaryPolicy". SuggestedCitation: BoardofGovernorsoftheFederalReserveSystem(US), FederalFundsEffectiveRate[FEDFUNDS], retrievedfromFRED, FederalReserveBankofSt.Louis; https://fred.stlouisfed.org/series/FEDFUNDS, August28,2022. RELEASETABLES H.15SelectedInterestRates SelectedInterestRatesInstruments,Yieldsinpercentperannum:Monthly RELATEDCONTENT RelatedResources FREDGraph FederalfundsratepublishedinTheWallStreetJournal FREDGraph FederalfundsratepublishedinTheNewYorkHerald-Tribune FRASERHistoricalDocument H.15SelectedInterestRates Article WouldIncreasingtheMinimumWageReducePoverty? FREDBlog Thedollarandeuroexchangeratesbreakeven FREDBlog Higherpublicdebt,butalowercosttoserviceit FREDBlog Gaugingreturnsandriskinthebondmarket ALFREDVintageSeries FederalFundsEffectiveRate OtherFormats Annual,NotSeasonallyAdjusted Biweekly,NotSeasonallyAdjusted Daily,NotSeasonallyAdjusted Daily,NotSeasonallyAdjusted Weekly,NotSeasonallyAdjusted RelatedCategories FRBRates-discount,fedfunds,primarycredit InterestRates Money,Banking,&Finance Sources More ReleasesfromBoardofGovernorsoftheFederalReserveSystem(US) Releases More SeriesfromH.15SelectedInterestRates Tags H.15SelectedInterestRates Federal InterestRate Interest BoardofGovernors Rate Monthly Nation PublicDomain:CitationRequested NotSeasonallyAdjusted UnitedStatesofAmerica × ConfirmDelete Areyousureyouwanttoremovethisseriesfromthegraph?Thiscannotbeundone. 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