Financial Education

Fed Funds Rate

Overnight interbank lending rate targeted by the Federal Reserve

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Fed Funds Rate

Overnight interbank lending rate targeted by the Federal Reserve

Definition

The federal funds rate is the interest rate at which banks lend reserves to each other overnight. The Federal Reserve targets this rate to influence economic activity, inflation, and employment through monetary policy.

Related Topics

#monetary policy #interest rates #federal reserve #overnight rate

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Category: Macro

Macro economics studies large-scale economic factors including interest rates, GDP, inflation, and government policies.

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