Dataset

This dataset was created by Joshua Quah Shou Sing

Contents

The performance of the S&P 500 following Federal Funds rate hikes generally shows that ********************** after a hike is when the impact is most pronounced, often resulting in lower or even negative returns. This initial reaction likely reflects investor uncertainty and market adjustment to the new borrowing costs. However, as time progresses, returns tend to stabilize, with the 12-month period typically showing recovery and improvement. Notably, the rate hike on March 17, 2022, stands out as an exception, as it resulted in negative returns across all observed periods (three months, six months, and 12 months), underscoring the unique market conditions and investor sentiment at that time.

Dataset Description

This dataset contains the actual and predicted federal funds target rate for the United States from 1990 to 2023. The federal funds target rate is the interest rate at which depository institutions lend their excess reserves to each other overnight. It is set by the Federal Open Market Committee (FOMC) and is a key tool used by the Federal Reserve to influence the economy.

The dataset includes the following five columns:

Release Date: The date on which the data was released by the Federal Reserve. Time: The time of day at which the data was released. Actual: The actual federal funds target rate. Predicted: The predicted federal funds target rate. Forecast: The forecast federal funds target rate.

Data Usage

This dataset can be used for a variety of purposes, including: - Analyzing trends in the federal funds target rate over time. - Forecasting the future path of the federal funds target rate. - Assessing the effectiveness of monetary policy. - Data Quality

The data for this dataset is of high quality. The Federal Reserve is a reputable source of data and the data is updated regularly.

Data Limitations

The data for this dataset is limited to the United States. Additionally, the data does not include information on the factors that influenced the Federal Open Market Committee's decision to set the federal funds target rate.

The benchmark interest rate in the United States was last recorded at 4.50 percent. This dataset provides the latest reported value for - United States Fed Funds Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

View data of the Effective Federal Funds Rate, or the interest rate depository institutions charge each other for overnight loans of funds.

During periods of rising policy rates, the performance of private credit investments appears to outperform other asset classes. During the latest Fed funds rates hikes between the end of 2021 and the second half of 2023, private credit investments returns were as high as ** percent. Private credit investments usually feature floating interest rates. This can boost returns when interest rates rise, but may lower potential returns when rates fall.

Revenue for the Open-End Investment Funds industry has been increasing over the past five years. Open-end investment funds revenue has been growing slightly but remaining relatively steady at a CAGR of 0.0% to $196.1 billion over the past five years, including an expected increase of 4.2% in the current year. In addition, industry profit has climbed and comprises 33.1% of revenue in the current year. Overall, revenue has been increasing alongside overall asset growth, despite operators being forced to lower fees to meet shifting consumer preferences. The industry has encountered volatility due to the high-interest rate environment for most of the period. Higher interest rates reduce liquidity and make fixed income securities more attractive to investors due to less risk and more predictable interest payments. The industry has also encountered increased growth for ETFs and retail investors. The greatest shift in the industry has been an evolving investor preference for exchange-traded funds (ETFs). While mutual funds account for the majority of industry assets, growth in ETF assets has significantly outpaced that of mutual funds. Expenses that mutual fund investors incur have fallen from 0.5% of assets in 2018 to 0.4% in 2023, as industry operators have cut fees to attract new capital due to pressure from new funds (latest data available). Despite the high interest rate environment, the Fed slashed rates in 2024 and is anticipated to cut rates further in the latter part of 2025, which will boost asset prices. Open-end investment funds' revenue is expected to grow at a CAGR of 0.3% to $198.7 billion over the five years to 2030. The fears over inflation and a possible recession are expected to dominate the beginning of the outlook period. The Federal Reserve is expected to continue cutting interest rates as inflationary pressures ease. Investment companies' importance will continue to grow, with mutual funds and ETFs representing key channels for individual and institutional investors to access financial markets.

Graph and download economic data for Holding Companies; Equity and Investment Fund Shares Excluding Mutual Fund Shares and Money Market Fund Shares; Asset, Transactions (BOGZ1FA733181105A) from 1946 to 2024 about fund shares, shares, mutual funds, MMMF, companies, equity, transactions, investment, assets, and USA.

Graph and download economic data for Domestic Financial Sectors; Equity and Investment Fund Shares Excluding Mutual Fund Shares and Money Market Fund Shares; Liability (IMA), Transactions (BOGZ1FA793181105A) from 1946 to 2024 about mutual funds, MMMF, IMA, equity, transactions, liabilities, sector, investment, domestic, and USA.

In recent years, industry assets have become increasingly integral to institutional investors' portfolios and the larger asset-management market. Institutional investors are individuals or organizations that trade securities in such substantial volumes that they qualify for lower commissions and fewer protective regulations since it's assumed that they're knowledgeable enough to protect themselves. Increasing demand from institutional investors has contributed to the surge in the industry's assets under management (AUM) and revenue during the current period. In recent years, the industry has continued to enmesh itself more deeply within the broader financial ecosystem despite the challenges posed at the onset of the period. The pandemic, mainly in the first quarter of 2020, contributed to revenue declines for many operators. Many portfolios, previously thought to be sound investments, were reevaluated and businesses pivoted their strategies due to the unprecedented nature of the crisis. However, as inflation was rampant in the latter part of the period, the FED increased interest rates to control high inflation, although as inflationary pressures eased in 2024, the FED cut interest rates, which will increase liquidity in financial markets. The Fed is anticipated to cut rates further in 2025, increasing liquidity and driving the shift of investments into equities from fixed-income securities. Overall, over the past five years, industry revenue grew at a CAGR of 4.2% to $310.1 billion, including an increase of 2.5% in 2025 alone. Industry profit has climbed significantly and will comprise 49.6% of revenue in the current year. Industry revenue will grow at a CAGR of 2.7% to $353.7 billion over the five years to 2030. The Federal Reserve is anticipated to cut interest rates as inflationary pressures continue to ease. These declining interest rates will increase liquidity in the markets. Private equity firms and hedge funds will have less difficulty raising capital for investments. As characteristics of the financial system change in light of post-financial crisis banking regulations and regulators' recognition of the importance of hedge funds within the financial system, hedge funds will likely experience heightened oversight.

Graph and download economic data for Federal Government; Total Exchange Stabilization Fund Economic Recovery Programs Investments in Federal Reserve Credit Facilities; Asset, Transactions (BOGZ1FA313094205A) from 1946 to 2024 about program, funds, equity, transactions, credits, investment, federal, assets, government, and USA.

The U.S. bank prime loan rate has undergone significant fluctuations over the past three decades, reflecting broader economic trends and monetary policy decisions. From a high of **** percent in 1990, the rate has seen periods of decline, stability, and recent increases. As of May 2025, the prime rate stood at *** percent, marking a notable rise from the historic lows seen in the early 2020s. Federal Reserve's impact on lending rates The prime rate's trajectory closely mirrors changes in the federal funds rate, which serves as a key benchmark for the U.S. financial system. In 2023, the Federal Reserve implemented a series of rate hikes, pushing the federal funds target range to 5.25-5.5 percent by year-end. This aggressive monetary tightening was aimed at combating rising inflation, and its effects rippled through various lending rates, including the prime rate. Long-term investment outlook While short-term rates have risen, long-term investment yields have also seen changes. The 10-year U.S. Treasury bond, a benchmark for long-term interest rates, showed an average market yield of **** percent in the second quarter of 2024, adjusted for constant maturity and inflation. This figure represents a recovery from negative real returns seen in 2021, reflecting shifting expectations for economic growth and inflation. The evolving yield environment has implications for both borrowers and investors, influencing decisions across the financial landscape.

Graph and download economic data for Rest of the World; Foreign Corporate Equities Including Foreign Investment Fund Shares; Liability, Transactions (BOGZ1FA263164100A) from 1946 to 2024 about foreign, equity, transactions, liabilities, and investment.

Graph and download economic data for Non-MMF Investment Funds; Long-Term Debt Securities; Asset, Transactions (BOGZ1FA694022605A) from 1946 to 2024 about non-mmf, long-term, transactions, investment, debt, securities, assets, and USA.

Graph and download economic data for Non-MMF Investment Funds; Total Liabilities and Equity, Transactions (BOGZ1FA694194005Q) from Q4 1946 to Q1 2025 about non-mmf, funds, equity, transactions, liabilities, investment, and USA.

Graph and download economic data for Producer Price Index by Industry: Portfolio Management and Investment Advice: Management of Bond Funds (PCU5239405239401102) from Jan 2017 to May 2025 about funds, management, investment, bonds, PPI, industry, price index, indexes, price, and USA.

Graph and download economic data for Federal Government; Exchange Stabilization Fund Economic Recovery Programs Investment in Corporate Credit Facilities (CCF); Asset, Transactions (BOGZ1FA313094243Q) from Q4 1946 to Q1 2025 about CCF, program, funds, equity, transactions, credits, investment, federal, corporate, assets, government, and USA.

Graph and download economic data for Non-MMF Investment Funds; Unidentified Miscellaneous Assets, Transactions (BOGZ1FA693093005A) from 1946 to 2024 about non-mmf, miscellaneous, transactions, investment, assets, and USA.

Graph and download economic data for Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity, Quoted on an Investment Basis (DGS30) from 1977-02-15 to 2025-07-31 about 30-year, maturity, Treasury, interest rate, interest, rate, and USA.

Graph and download economic data for Rest of the World; Equity and Investment Fund Shares Excluding Mutual Fund Shares and Money Market Fund Shares; Liability (IMA), Transactions (ROWEFSQ027S) from Q4 1946 to Q1 2025 about mutual funds, MMMF, IMA, equity, transactions, liabilities, and investment.