The Decades Rate History

July 21, 2003
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The last time the Federal Open Market Committee raised the federal funds rate was on March 21, 2000, when the board lifted it to 6 percent from 5.75 percent. Since then, the board has cut the rate 14 times with the latest slice dropping it to 1 percent — the lowest it has been since 1958.

The accompanying chart chronicles the action the FOMC has taken on the funds rate and the discount rate over the past decade.

The funds rate is the lowest short-term market interest rate that banks charge each other on overnight loans. The discount rate is the interest rate the Fed charges banks for commercial loans. The discount rate is usually set a half-point below the fed fund rate and is largely symbolic because the Fed doesn’t engage in these loans very often.

The chart reads across the page starting with the most recent FOMC action.

                     Funds       Discount                          Funds         Discount
Date            Rate          Rate              Date            Rate            Rate
06/25/03    1.00%        0.50%            11/06/02    1.25%           0.75%
12/11/01    1.75%        1.25%            11/06/01    2.00%           1.50%
10/02/01    2.50%        2.00%            09/17/01    3.00%           2.50%
08/21/01    3.50%        3.00%            06/27/01    3.75%           3.25%
05/15/01    4.00%        3.50%            04/18/01    4.50%           4.00%
03/20/01    5.00%        4.50%            01/31/01    5.50%           5.00%
01/03/01    6.00%        5.50%            05/16/00    6.50%           6.00%
03/21/00    6.00%        5.50%            02/02/00    5.75%           5.25%
11/16/99    5.50%        5.00%            08/24/99    5.25%           4.75%
06/30/99    5.00%        4.50%            11/17/98    4.75%           4.25%
10/15/98    5.00%        4.50%            09/29/98    5.25%           4.75%
03/25/97    5.50%        5.00%            01/31/96    5.25%           4.75%
12/19/95    5.50%        5.00%            07/06/95    5.75%           5.25%
02/01/95    6.00%        5.50%            11/15/94    5.50%           5.00%
08/16/94    4.75%        4.25%            05/17/94    4.25%           3.75%
04/18/94    3.75%        3.25%            03/22/94    3.50%           3.00%
02/04/94    3.25%        2.75%

Source: Associated Press.

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