United States Interest Rate

The benchmark interest rate in the United States was last recorded at 0.25 percent. Interest Rate in the United States is reported by the Federal Reserve. Historically, from 1971 until 2013, the United States Interest Rate averaged 6.17 Percent reaching an all time high of 20 Percent in March of 1980 and a record low of 0.25 Percent in December of 2008. In the United States, the authority for interest rate decisions is divided between the Board of Governors of the Federal Reserve (Board) and the Federal Open Market Committee (FOMC). The Board decides on changes in discount rates after recommendations submitted by one or more of the regional Federal Reserve Banks. The FOMC decides on open market operations, including the desired levels of central bank money or the desired federal funds market rate. This page includes a chart with historical data for the United States Interest Rate.

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United States Interest Rate
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Fed Keeps Rates and Strategy
Federal Reserve | Nuno Fontes | nuno@tradingeconomics.com  |  5/1/2013 7:08:06 PM


U.S. Federal Reserve produced no surprises on May 1st, continuing its asset-purchase program and maintaining its benchmark interest rate unchanged at 0.25%.

Information received since the Federal Open Market Committee met in March suggests that economic activity has been expanding at a moderate pace. Labor market conditions have shown some improvement in recent months, on balance, but the unemployment rate remains elevated. Household spending and business fixed investment advanced, and the housing sector has strengthened further, but fiscal policy is restraining economic growth. Inflation has been running somewhat below the Committee's longer-run objective, apart from temporary variations that largely reflect fluctuations in energy prices. Longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic growth will proceed at a moderate pace and the unemployment rate will gradually decline toward levels the Committee judges consistent with its dual mandate. The Committee continues to see downside risks to the economic outlook. The Committee also anticipates that inflation over the medium term likely will run at or below its 2 percent objective.
 
To support a stronger economic recovery and to help ensure that inflation, over time, is at the rate most consistent with its dual mandate, the Committee decided to continue purchasing additional agency mortgage-backed securities at a pace of $40 billion per month and longer-term Treasury securities at a pace of $45 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. Taken together, these actions should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative.

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Fed Keeps Rates and Strategy U.S. Federal Reserve produced no surprises on March 20th, affirming that it would plow ahead with its efforts to stimulate the economy even as it hailed “a return to moderate economic growth following a pause late last year.” 2013-03-20
U.S. Federal Reserve Leaves Monetary Policy Unchanged The Federal Reserve said on August 1st that the economy is losing strength and repeated a pledge to take further steps to stimulate growth if the job market doesn't show sustained improvement. 2012-08-01
U.S. to Keep Buying Bonds, Rates Unchanged The Federal Reserve said it will buy $40 billion a month of mortgage-backed securities, continuing its asset-purchase program, and linked the outlook for its main interest rate to unemployment and inflation. 2013-01-31
US Fed Extends Stimulus Measures The U.S. central bank expanded its “Operation Twist” by $267 billion (€211 billion), meaning it will sell short-term securities and buy long-term ones in an effort to keep borrowing costs down. 2012-06-21
U.S. to Keep Buying Bonds, Rates Unchanged The Federal Reserve said it will buy $45 billion a month of Treasury securities starting in January, expanding its asset-purchase program, and it linked the outlook for its main interest rate to unemployment and inflation. 2012-12-12
U.S. Federal Reserve Reaffirms Low-Rate Policy U.S. Federal Reserve on April 25th confirmed the plan to keep short-term interest rates near zero through late 2014 and modestly toned down their assessment of the economy's performance. 2012-04-25
U.S. Keeps Monetary Policy Unchanged The U.S. Federal Reserve said on October 24th it has decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that exceptionally low levels for the federal funds rate are likely to be warranted at least through mid-2015. 2012-10-24
U.S. Fed Keeps Monetary Policy Unchanged The Federal Reserve acknowledged recent signs of strength in the economy and said recent financial market strains have eased, offering few clues on the chances for further monetary easing. 2012-03-13
U.S. Federal Reserve Launches QE3 The Federal Reserve said on September 13th it will buy mortgages, fulfilling expectations of more stimulus, in an attempt to foster a recovery in the real estate market. The purchases will continue until the Fed is satisfied that economic conditions, primarily in unemployment, improve. 2012-09-13



Interest Rate | Notes

The interest rate shown on this page refers to the central bank benchmark interest rate. Usually, the central bank benchmark interest rate is the overnight rate at which central banks make loans to the commercial banks under their jurisdiction. Moving the benchmark interest rate, the central bank is able to make an impact on interest rates of commercial banks, inflation level of the country and national currency exchange rate. Reduction of interest rates should bring increase in business activity, a rise in inflation rate and weakening of national currency. In case of increase in interest rates the level of business activity is likely to drop, inflation declines and national currency strengthens.






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