Charts are keyboard readable: focus a chart, then use the left and right arrow keys to step one reading at a time, hold Shift to step a year (ten readings on a yearly chart), Home and End for the first and last month, Escape to let go. In the timeline, tab to Window Start or Window End and use the arrow keys to move it.
Federal Funds Rate
About This Indicator
What Is the Federal Funds Rate?
The rate banks charge one another for overnight loans: the Federal Reserve's main lever on the economy.
Why Does It Matter?
A higher rate slows spending, hiring, and in time inflation by making borrowing costlier; a lower rate does the reverse. Credit card rates follow within weeks. The Fed tends to cut fastest as a recession hits, so a plunging line usually means trouble, not good times.
Can Politics Influence It?
Through appointments, and at times through pressure. The President nominates the chair and governors, but governors serve staggered fourteen-year terms, and five of the twelve rate votes go to regional Reserve Bank heads the White House does not choose.
Key Idea
A rate move typically takes a year or more to reach hiring and prices in full, so a rate set under one administration often shapes the economy under the next. That delay is the classic case for Fed independence: easy money can feel good before a vote and show up as inflation after.
Not Scored
Source: FRED (Federal Reserve). FEDFUNDS from July 1954; FFHTHIGH, FFHTLOW, FFWSJHIGH, and FFWSJLOW before.
Loading the dataset…