Average Hourly Earnings Growth vs Federal Funds Rate (Target Range Upper Bound)
Average Hourly Earnings Growth is currently 3.8% (down -0.2%). Federal Funds Rate (Target Range Upper Bound) is currently 4.5% (flat 0.0%).
| Metric | Average Hourly Earnings Growth | Federal Funds Rate (Target Range Upper Bound) |
|---|---|---|
| Current value | 3.8% | 4.5% |
| Previous reading | 4% | 4.5% |
| Change | -0.2% | 0.0% |
| Trend | down | flat |
| Frequency | Monthly | As Announced |
| Source | Bureau of Labor Statistics | Federal Reserve |
| Last updated | 2026-04-04 | 2026-03-19 |
| Category | employment | rates |
What Average Hourly Earnings Growth measures
Average hourly earnings measures the year-over-year percentage change in wages for all private-sector employees. It is a key indicator of labor cost pressures and consumer spending power.
Wage growth at 3.8% year-over-year outpaces current inflation, meaning workers are gaining real purchasing power. For executives, this signals continued pressure on labor budgets — compensation packages must grow to retain talent. However, wage growth moderating from 4%+ suggests the worst of the post-pandemic wage spiral may be easing.
What Federal Funds Rate (Target Range Upper Bound) measures
The federal funds rate is the interest rate at which banks lend to each other overnight. Set by the Federal Reserve's FOMC, it is the most important interest rate in the world — influencing everything from mortgage rates to corporate borrowing costs to the value of the dollar.
The Fed has held rates at 4.25-4.50% since December 2024, pausing after three cuts. For executives, this means borrowing costs remain elevated: corporate bond yields, commercial real estate financing, and revolving credit all price off the fed funds rate. The 'higher for longer' stance means capital-intensive projects need higher return hurdles. Companies with strong cash positions have an advantage over those reliant on debt financing.
Frequently asked
Average Hourly Earnings Growth is currently 3.8%, down -0.2% from the previous reading. Source: Bureau of Labor Statistics, updated monthly.
Federal Funds Rate (Target Range Upper Bound) is currently 4.5%, flat 0.0% from the previous reading. Source: Federal Reserve, updated as announced.
Wage growth at 3.8% year-over-year outpaces current inflation, meaning workers are gaining real purchasing power. For executives, this signals continued pressure on labor budgets — compensation packag The Fed has held rates at 4.25-4.50% since December 2024, pausing after three cuts. For executives, this means borrowing costs remain elevated: corporate bond yields, commercial real estate financing,