Federal funds rate history: 1954 to September 2024

The Fed cut rates at the its sixth meeting by 50 basis points on Wednesday, September, 2024, to a target range of 4.75% to 5%.This is the first cut we’ve seen since 2020. And signals point to further rate cuts to come.

Latest federal funds rate data at a glance

1. Current fed rate: The Fed cut rates to a range of 4.75%-5% following the September 18, 2024 meeting⁽¹⁾
2. Effective federal funds rate: 5.33% as of September 18, 2024⁽⁴⁾
3. Previous meeting: Hold at 5.25% to 5.50% on July 31, 2024⁽¹⁾
4. Rate this time last year: Held rates at a range of 5.25-5.50% a its September meeting in 2023⁽¹⁾
5. Next meeting: November 6-7, 2024⁽²⁾
6. Highest rate since 1954: 19.1% monthly average recorded June 1981⁽³⁾
7. Lowest rate since 1954: 0.05% monthly average recorded April 2020⁽³⁾

Changes to the federal funds rate in the last 12 months

The Fed finally cut rates, bringing the target range from 5.25%-5.50% to 4.75%-5% following the sixth Federal Open Market Committee (FOMC) meeting of 2024.

Over the last 24 months or so we’ve seen a lot of movement in the Fed rate, with the Fed raising rates four times in 2023, starting with consecutive rate increases of 25 basis points in February, March and May 2023, rates holding in June only increased by a further 25 basis point hike in July. Since the it’s been string of holds — September, through till now.

The Fed raised rates seven times in 2022, which is the highest number of Fed rate hikes in a single year since 2005. While 2005 saw more Fed rate hikes in total (8), individual increases were just 25 basis points, whereas the changes in 2022 have ranged from 25 to 75 basis points.

• Data table

6 years of changes to the federal funds rate

Since 2018, the average federal funds rate has been 2.1%, which is roughly two and a half times lower than it is today. During this period, however, the US saw historically low rates, in part due to COVID, with rates hitting a record low of 0.05% for the months of April and May 2020.

The history of federal funds rate changes

While it’s not a great sign that the fed rate is way up, following the 0.5% cut at the September Fed meeting the effective federal funds rate should be around 4.83%, it’s pretty close to the average rate since 1954 — which is 4.6%.

2024 FOMC meeting calendar

Seven meetings of the Federal Open Market Committee are scheduled for 2024.