United States Prime Rate

also known as the Fed, National or United States Prime Rate,
from the interest-rate specialists at www.FedPrimeRate.comSM

Sunday, February 02, 2025

Odds Now At 80% (Likely) The U.S. Prime Rate Will Continue at 7.50% After the March 19, 2025 FOMC Monetary Policy Meeting

United States Prime Rate Forecast
Prime Rate Prediction

Prime Rate Forecast

As of right now, our odds are at 80% (likely) the Federal Open Market Committee (FOMC) of the Federal Reserve will vote to leave the benchmark target range for the fed funds rate (TRFFR) at 4.25% - 4.50% at the March 19TH, 2025 monetary policy meeting, leaving the U.S. Prime Rate at the current 7.50%.

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Housing Inflation & Affordability


From the good folks at Bank of America®, the following is a quote from a June, 2024 CNN article:

"Economists at Bank of America warned this week that the U.S. housing market is 'stuck and we are not convinced it will become unstuck' until 2026 -- or later..."

Prescient words, as evidenced by the latest inflation data from the Commerce Department.  The housing affordability situation keeps getting worse 👇📈👇 :

 
www.FedPrimeRate.com: Changes in Monthly Consumer Spending - December 2024 UPDATE
www.FedPrimeRate.com: Changes in Monthly
Consumer Spending - December 2024 UPDATE

Scary news, but there is some hope.

Since hitting a record high of $426,900 back in June of last year, the cost for a used home has been easing, according to the superlative folks at the National Association of REALTORS®.  During December of 2024, the median cost for a previously owned home was $404,400.

Stay tuned...
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The United States Prime Rate was lowered to the current 7.50% on December 18, 2024.

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SUMMARY

  • Current odds the U.S. Prime Rate will hold at the current 7.50% after the March 19TH, 2025 FOMC monetary policy meeting: 80% (likely.)
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Wednesday, January 29, 2025

First FOMC Monetary Policy Meeting of 2025 Adjourned: United States Prime Rate Holds At 7.50%

United States Prime Rate holds at 7.50%
United States Prime Rate

The Federal Open Market Committee (FOMC) of the Federal Reserve System has just adjourned its first monetary policy meeting of 2025 and, in accordance with our latest forecast, has voted to leave the benchmark target range for the federal funds rate at 4.50% - 4.75% to 4.25% - 4.50%. Therefore, the United States Prime Rate (a.k.a the Fed Prime Rate) continues at 7.50%.

NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

Here's a clip from today's FOMC press release (note text in bold):

"...Recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid.  Inflation remains somewhat elevated.

The Committee seeks to achieve maximum employment and
inflation at the rate of 2 percent over the longer run. The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.

In support of its goals, the Committee decided to maintain the target range for the federal funds rate at 4-1/4 to 4-1/2 percent. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee will continue reducing its holdings of
Treasury securities and agency debt and agency mortgagebacked securities. The Committee is strongly committed to supporting maximum employment and returning  inflation to its 2 percent objective.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust
the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michael S. Barr; Michelle W. Bowman; Susan M. Collins; Lisa D. Cook; Austan D. Goolsbee; Philip N. Jefferson; Adriana D. Kugler; Alberto G. Musalem; Jeffrey R. Schmid; and Christopher J. Waller.
.."

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 The United States Prime Rate was lowered to the current 7.50% on December 18, 2024.

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Monday, December 30, 2024

Odds Now At 90% (Likely) The U.S. Prime Rate Will Hold at 7.50% After the January 29, 2025 FOMC Monetary Policy Meeting

United States Prime Rate Forecast
Prime Rate Prediction

Prime Rate Forecast

As of right now, our odds are at 90% (likely) the Federal Open Market Committee (FOMC) of the Federal Reserve will vote to keep the benchmark target range for the fed funds rate (TRFFR) at 4.25% - 4.50% at the January 29TH, 2025 monetary policy meeting, leaving the U.S. Prime Rate at the current 7.50%.

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The American Consumer


Is the American consumer ready to keep the American economy going strong in 2025?

"...Broadly speaking, consumers believe that the economy has improved considerably as inflation has slowed, but they do not feel that they are thriving..."
Month-on-month, the ICS was +3.06%, while year-on-year it was +6.07%.

Stay tuned...
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The United States Prime Rate was lowered to the current 7.50% on December 18, 2024.

=======

SUMMARY

  • Current odds the U.S. Prime Rate will hold at the current 7.50% after the January 29TH, 2025 FOMC monetary policy meeting: 90% (likely.)
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Wednesday, December 18, 2024

Eighth and Final FOMC Meeting of 2024 Adjourned: United States Prime Rate Is Now 7.50%

United States Prime Rate is now 7.50%
United States Prime Rate

The Federal Open Market Committee (FOMC) of the Federal Reserve System has just adjourned its eighth and final monetary policy meeting of 2024 and, in accordance with our latest forecast, has voted to lower the benchmark target range for the federal funds rate by 25 basis points (0.25 percentage point) from 4.50% - 4.75% to 4.25% - 4.50%. Therefore, the United States Prime Rate (a.k.a the Fed Prime Rate) is now 7.50%.

NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

Here's a clip from today's FOMC press release (note text in bold):

"...Recent indicators suggest that economic activity has continued to expand at a solid pace. Since earlier in the year, labor market conditions have generally eased, and the unemployment rate has moved up but remains low. Inflation has made progress toward the Committee's 2 percent objective but remains somewhat elevated.

The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.

In support of its goals, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4-1/4 to 4-1/2 percent. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee will continue reducing its holdings of 
Treasury securities and agency debt and agency mortgage‑backed securities. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust
the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditionsinflation pressures and inflation expectations, and financial and international developments.

Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Thomas I. Barkin; Michael S. Barr; Raphael W. Bostic; Michelle W. Bowman; Lisa D. Cook; Mary C. Daly; Philip N. Jefferson; Adriana D. Kugler; and Christopher J. Waller. Voting against the action was Beth M. Hammack, who preferred to maintain the target range for the federal funds rate at 4-1/2 to 4-3/4 percent.
.."

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Friday, December 13, 2024

Odds Now At 95% (Very Likely) The U.S. Prime Rate Will Be Cut to 7.50% at the December 18, 2024 FOMC Monetary Policy Meeting

United States Prime Rate Forecast
Prime Rate Prediction

Prime Rate Forecast

As of right now, our odds are at 95% (very likely) the Federal Open Market Committee (FOMC) of the Federal Reserve will vote to lower the benchmark target range for the fed funds rate (TRFFR) by 0.25 percentage point (25 basis points [bps]) at the December 18TH, 2024 monetary policy meeting.


A 25 bps cut would cause Prime to decrease, from the
current 7.75%, to  7.50%. 

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Stay tuned...
=======

The United States Prime Rate was lowered to the current 7.75% on November 7, 2024.

=======

SUMMARY

  • Current odds the U.S. Prime Rate will be cut to 7.50% at the December 18TH, 2024 FOMC monetary policy meeting: 95% (very likely.)
=========

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Sunday, December 01, 2024

Federal Open Market Committee (FOMC) Monetary Policy Meeting Schedule for 2025 & 2026

FOMC Meeting Schedule for 2025 and 2026

👇: Here's the Federal Open Market Committee (FOMC) monetary policy meeting schedule for 2025 and 2026.

Why is this schedule important to you? Because it's at these monetary policy meetings that the FOMC votes on whether to raise, lower or make no changes to the target range for Fed Funds Target Rate, and when the Fed Funds Target Rate changes, the United States Prime Rate (also known as the Fed Prime Rate) will also change (how the United States Prime Rate works):

======👇2025👇======

  • January 29, 2025

  • March 19, 2025

  • May 7, 2025

  • June 18, 2025

  • July 30, 2025

  • September 17, 2025

  • October 29, 2025

  • December 10, 2025

======👇2026👇======

  • January 28, 2026

  • March 18, 2026

  • April 29, 2026

  • June 17, 2026

  • July 29, 2026

  • September 16, 2026

  • October 28, 2026

  • December 9, 2026

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  • January 27, 2027

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Saturday, November 09, 2024

Odds Now At 60% (On The Fence) The U.S. Prime Rate Will Be Cut to 7.50% at the December 18, 2024 FOMC Monetary Policy Meeting

United States Prime Rate Forecast
Prime Rate Prediction

Prime Rate Forecast

As of right now, our odds are at 60% (on the fence) the Federal Open Market Committee (FOMC) of the Federal Reserve will vote to lower the benchmark target range for the fed funds rate (TRFFR) by 0.25 percentage point (25 basis points [bps]) at the December 18TH, 2024 monetary policy meeting.


A 25 bps cut would cause Prime to decrease, from the
current 7.75%, to  7.50%. 

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  • Year-on-year (Y-O-Y), the CORE PCE Price Index moved sideways from August to September -- 2.7% to 2.7%.

  • Y-O-Y, from August to September, the PCE Price Index eased, from 2.3% to 2.1%.

Stay tuned...
=======

The United States Prime Rate was lowered to the current 7.75% on November 7, 2024.

=======

SUMMARY

  • Current odds the U.S. Prime Rate will be cut to 7.50% at the December 18TH, 2024 FOMC monetary policy meeting: 60% (On The Fence.)
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Thursday, November 07, 2024

Seventh FOMC Meeting of 2024 Adjourned: United States Prime Rate Is Now 7.75%

United States Prime Rate is now 7.75%
United States Prime Rate

The Federal Open Market Committee (FOMC) of the Federal Reserve System has just adjourned its seventh monetary policy meeting of 2024 and, in accordance with our latest forecast, has voted to cut the benchmark target range for the federal funds rate by 25 basis points (0.25 percentage point) from 4.75% - 5.00% to 4.50% - 4.75%. Therefore, the United States Prime Rate (a.k.a the Fed Prime Rate) is now 7.75%.

NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

Here's a clip from today's FOMC press release (note text in bold):

"...Recent indicators suggest that economic activity has continued to expand at a solid pace. Since earlier in the year, labor market conditions have generally eased, and the unemployment rate has moved up but remains low. Inflation has made progress toward the Committee's 2 percent objective but remains somewhat elevated.

The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The Committee judges that the risks to achieving its employment and
inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.

In support of its goals, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4-1/2 to 4-3/4 percent. In considering additional adjustments to the target range for the 
federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the
stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on  labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Thomas I. Barkin; Michael S. Barr; Raphael W. Bostic; Michelle W. Bowman; Lisa D. Cook; Mary C. Daly; Beth M. Hammack; Philip N. Jefferson; Adriana D. Kugler; and Christopher J. Waller.
.."

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Sunday, September 29, 2024

Odds Now At 99% (VERY LIKELY) The U.S. Prime Rate Will Be Cut By At Least 25 Basis Points (0.25 Percentage Point) at the November 7, 2024 FOMC Monetary Policy Meeting

United States Prime Rate Forecast
Prime Rate Prediction

Prime Rate Forecast

As of right now, our odds are at 99% (very likely) the Federal Open Market Committee (FOMC) of the Federal Reserve will vote to lower the cardinal target range for the fed funds rate (TRFFR) by at least 0.25 percentage point (25 basis points [bps]) at the November 7TH, 2024 monetary policy meeting.

A 25 bps cut would cause Prime to decrease, from the
current 8.00%, to  7.75%. 

A 50 bps cut would lower the
TRFFR to a range of 4.25% - 4.50%, and would result in a Prime Rate of 7.50%, a level not seen since December of 2022.

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  • Y-O-Y, the Core CPI for August, 2024 came in at +3.197%.
  • Stay tuned...
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    The United States Prime Rate was lowered to the current 8.00% on September 18, 2024.

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    SUMMARY

    • Current odds the U.S. Prime Rate will be cut to 7.75% or lower at the November 7TH, 2024 FOMC monetary policy meeting: 99% (very likely.)
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    Wednesday, September 18, 2024

    Sixth FOMC Meeting of 2024 Adjourned: United States Prime Rate Is Now 8.00%

    United States Prime Rate is now 8.00%
    United States Prime Rate

    The Federal Open Market Committee (FOMC) of the Federal Reserve System has just adjourned its sixth monetary policy meeting of 2024 and, in accordance with our latest forecast, has voted to cut the benchmark target range for the federal funds rate by 50 basis points (0.50 percentage point) from 5.25% - 5.50% to 4.75% - 5.00%. Therefore, the United States Prime Rate (a.k.a the Fed Prime Rate) is now 8.00%.

    NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

    Here's a clip from today's FOMC press release (note text in bold):

    "...Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have slowed, and the unemployment rate has moved up but remains low. Inflation has made further progress toward the Committee's 2 percent objective but remains somewhat elevated.

    The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.

    In light of the progress on inflation and the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/2 percentage point to 4-3/4 to 5 percent. In considering additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective.

    In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

    Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Thomas I. Barkin; Michael S. Barr; Raphael W. Bostic; Lisa D. Cook; Mary C. Daly; Beth M. Hammack; Philip N. Jefferson; Adriana D. Kugler; and Christopher J. Waller. Voting against this action was Michelle W. Bowman, who preferred to lower the target range for the federal funds rate by 1/4 percentage point at this meeting..."

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