Federal Funds Target Range - Lower Limit
DFEDTARL • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
4.25
Year-over-Year Change
0.00%
Date Range
11/16/2022 - 8/11/2025
Summary
The Federal Funds Target Range - Lower Limit represents the minimum interest rate at which depository institutions lend reserve balances to each other overnight. This key monetary policy indicator directly influences borrowing costs, credit availability, and overall economic conditions in the United States.
Analysis & Context
This economic indicator provides valuable insights into current market conditions and economic trends. The data is updated regularly by the Federal Reserve and represents one of the most reliable sources for economic analysis.
Understanding this metric helps economists, policymakers, and investors make informed decisions about economic conditions and future trends. The interactive chart above allows you to explore historical patterns and identify key trends over time.
About This Dataset
This metric is set by the Federal Open Market Committee (FOMC) as part of its monetary policy strategy to manage economic growth and inflation. Economists closely monitor this rate as a critical signal of the Federal Reserve's stance on economic stimulus or contraction.
Methodology
The lower limit is determined through deliberative decisions by the Federal Reserve's FOMC, based on comprehensive economic data and forecasts.
Historical Context
This indicator is crucial for guiding financial institutions' lending practices, influencing consumer and business borrowing rates, and signaling the broader macroeconomic policy direction.
Key Facts
- The rate directly impacts short-term borrowing costs for financial institutions
- Changes reflect the Federal Reserve's economic outlook and policy intentions
- Influences broader financial markets and economic conditions
FAQs
Q: How often does the Federal Reserve adjust this rate?
A: The FOMC typically reviews and potentially adjusts the rate during its eight scheduled meetings per year, though emergency changes can occur during exceptional economic circumstances.
Q: What impact does this rate have on consumers?
A: Changes in the federal funds rate can affect interest rates for mortgages, credit cards, and other consumer loans, directly influencing borrowing costs and economic activity.
Q: How is this rate different from the prime rate?
A: The federal funds rate is the rate banks charge each other, while the prime rate is the rate banks charge their most creditworthy corporate customers, typically set slightly higher.
Q: Why do economists watch this rate so closely?
A: This rate is a key indicator of monetary policy stance, providing insights into the Federal Reserve's economic strategy and potential future economic conditions.
Q: How frequently is this data updated?
A: The data is typically updated after each FOMC meeting, with the exact timing depending on policy decisions and economic assessments.
Related Trends
Flexible Rate on Seasonal Credit in Federal Reserve District 8: St. Louis
FLEXSC
Effective Federal Funds Volume
EFFRVOL
Longer Run FOMC Summary of Economic Projections for the Fed Funds Rate, Range, High
FEDTARRHLR
Secured Overnight Financing Rate: 75th Percentile
SOFR75
30-Day Average SOFR
SOFR30DAYAVG
Discount Window Primary Credit Rate
DPCREDIT
Citation
U.S. Federal Reserve, Federal Funds Target Range - Lower Limit [DFEDTARL], retrieved from FRED.
Last Checked: 8/1/2025