Covered Policy Rate
Federal Funds Effective Rate
Overnight Reference Rate · Overnight
Current rate3.880%
Classification: Policy rate
Provider: Federal Reserve Bank of New York via FRED (fallback)
Symbol: EFFR
Sources: Federal Reserve Bank of New York via FRED (fallback)
Historical chart
AI-Assisted Chart Analysis
Federal Funds Effective Rate technical analysis
Calculated from verified chart history for the selected tenor; no news or fundamental assumptions are used.
Mixed trend: the latest level is above its 20-period average, without full long-term confirmation.
RSI is 100, a extended reading. Above 70 can signal extension; below 30 can signal exhaustion.
The first technical watch zone is 3.630%. A break below 3.620% invalidates the near-term support setup.
The first resistance/watch zone is 3.880%. A confirmed break above 3.880% supports continuation.
Annualized realized volatility is +12.6%. Maximum lookback drawdown is -16.4%, from a high-water mark of 4.330% to 3.620%.
Potential levels are conditional chart scenarios, not personalized advice or instructions to buy or sell.
Current signal
- The Federal Funds Effective Rate (EFFR) is currently observed at 3.88% as of September 18, 2026, according to official data from the Federal Reserve Bank of New York.
- The rate has remained stable on a daily basis, showing no change in the most recent observation period.
What changed
- The EFFR has increased by 25.0 basis points over the past week and the past month, indicating a shift in the overnight lending environment compared to the previous 30-day period.
- Year-to-date, the rate has seen a cumulative adjustment of approximately 24 basis points.
Why it matters
- As the primary benchmark for overnight borrowing costs, the 3.88% EFFR directly influences the cost of capital for financial institutions and serves as the foundation for short-term interest rate pricing across the broader economy.
- The 25-basis-point increase over the last month signals a tightening in liquidity conditions or a response to monetary policy adjustments, which typically impacts the yield curve and borrowing costs for consumers and corporations.
- For fixed-income investors, the stability of the overnight rate provides a baseline for assessing the risk-free rate, influencing valuation models for duration-sensitive assets.
Bullish rate drivers
- A higher EFFR generally supports the net interest margins of commercial banks by increasing the yield on floating-rate assets.
- The upward adjustment in the rate may reflect official confidence in economic stability or a proactive stance against inflationary pressures, which can be viewed as supportive of currency valuation.
Bearish rate drivers
- Increased overnight borrowing costs raise the cost of leverage for market participants, potentially dampening speculative activity and reducing liquidity in risk assets.
- Higher short-term rates can exert downward pressure on equity valuations by increasing the discount rate applied to future cash flows.
Key catalysts
- Future Federal Open Market Committee (FOMC) policy decisions and official communications regarding the target range for the federal funds rate remain the primary drivers of this metric.
- Official releases concerning inflation, employment, and economic growth metrics will dictate the Federal Reserve's future policy trajectory.
Key risks
- Unexpected shifts in monetary policy or a divergence between market expectations and official Federal Reserve actions could lead to volatility in overnight funding markets.
- Liquidity constraints in the banking system could cause the effective rate to deviate from the Federal Reserve's target range.
Upcoming events
- Market participants are monitoring upcoming Federal Reserve policy meetings for potential adjustments to the target federal funds rate range.
- Scheduled releases of official U.S. Treasury auction results and economic data reports will provide further context for interest rate expectations.
Latest verified updates
- The Federal Reserve Bank of New York reported the EFFR at 3.88% on September 18, 2026, based on official data retrieved via FRED.
- No further intra-day updates or policy announcements have been recorded in the available verified data since the September 18 observation.
Sources
Federal Reserve Bank of New York via FRED (fallback)
- U.S. TreasuryOfficialofficial yields, auctions, and issuance
- Federal ReserveOfficialofficial policy decisions and communications
- FREDOfficialofficial economic and rate time series
- New York FedOfficialSOFR and money-market reference rates
- CME FedWatchAnalyst Opinionmarket-implied policy probabilities
- FINRA TRACEOfficialfixed-income transaction context
- Reuters RatesReportedprofessional rates and bond reporting
- Trading EconomicsReportedmarket yield observation fallback
- PIMCOAnalyst Opinionprofessional duration and macro opinion
- BlackRockAnalyst Opinionprofessional macro and fixed-income opinion
- Public market discussionSocial Signalunverified rates sentiment and claims requiring confirmation
Last updated: 2026-09-18