Federal Funds Rate (Target Range Upper Bound) vs Producer Price Index (PPI) — Year-over-Year
Federal Funds Rate (Target Range Upper Bound) is currently 4.5% (flat 0.0%). Producer Price Index (PPI) — Year-over-Year is currently 2.7% (down -0.5%).
| Metric | Federal Funds Rate (Target Range Upper Bound) | Producer Price Index (PPI) — Year-over-Year |
|---|---|---|
| Current value | 4.5% | 2.7% |
| Previous reading | 4.5% | 3.2% |
| Change | 0.0% | -0.5% |
| Trend | flat | down |
| Frequency | As Announced | Monthly |
| Source | Federal Reserve | Bureau of Labor Statistics |
| Last updated | 2026-03-19 | 2026-03-13 |
| Category | rates | inflation |
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.
What Producer Price Index (PPI) — Year-over-Year measures
The Producer Price Index measures the average change in selling prices received by domestic producers for their output. It is a leading indicator of consumer inflation — rising producer costs eventually get passed to consumers.
PPI declining to 2.7% from 3.2% signals easing upstream cost pressures. For executives, falling producer prices suggest input cost relief is coming — raw materials, components, and wholesale goods are becoming cheaper relative to recent months. This is bullish for profit margins if selling prices remain stable.
Frequently asked
Federal Funds Rate (Target Range Upper Bound) is currently 4.5%, flat 0.0% from the previous reading. Source: Federal Reserve, updated as announced.
Producer Price Index (PPI) — Year-over-Year is currently 2.7%, down -0.5% from the previous reading. Source: Bureau of Labor Statistics, updated monthly.
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, PPI declining to 2.7% from 3.2% signals easing upstream cost pressures. For executives, falling producer prices suggest input cost relief is coming — raw materials, components, and wholesale goods are