The Discount Rate

The discount rate is the interest rate charged to commercial banks and other depository institutions on loans they receive from their regional Federal Reserve Bank's lending facility--the discount window. The Federal Reserve Banks offer three discount window programs to depository institutions: primary credit, secondary credit, and seasonal credit, each with its own interest rate. All discount window loans are fully secured.

Under the primary credit program, loans are extended for a very short term (usually overnight) to depository institutions in generally sound financial condition. Depository institutions that are not eligible for primary credit may apply for secondary credit to meet short-term liquidity needs or to resolve severe financial difficulties. Seasonal credit is extended to relatively small depository institutions that have recurring intra-year fluctuations in funding needs, such as banks in agricultural or seasonal resort communities.

The discount rate charged for primary credit (the primary credit rate) is set above the usual level of short-term market interest rates. (Because primary credit is the Federal Reserve's main discount window program, the Federal Reserve at times uses the term "discount rate" to mean the primary credit rate.) The discount rate on secondary credit is above the rate on primary credit. The discount rate for seasonal credit is an average of selected market rates. Discount rates are established by each Reserve Bank's board of directors, subject to the review and determination of the Board of Governors of the Federal Reserve System. The discount rates for the three lending programs are the same across all Reserve Banks except on days around a change in the rate.

Further information on the discount window, including interest rates, is available from the Federal Reserve System's discount window web site. See also the articles in the Federal Reserve Bulletin for July 2002 (51 KB PDF) and November 1994 (75 KB PDF).

Minutes of the Board of Governors discount rate meetings

November 4 and December 11, 2019 (PDF)

October 7 through October 30, 2019 (PDF)

August 26 and September 18, 2019 (PDF)

July 1 through July 31, 2019 (PDF)

June 19, 2019 (PDF)

April 22 and May 1, 2019 (PDF)

February 25 through March 20, 2019 (PDF)

January 22 and January 30, 2019, 2019 (PDF)

December 10 and 19, 2018 (PDF)

November 8, 2018 (PDF)

August 27 through September 26, 2018 (PDF)

July 9 through August 1, 2018 (PDF)

June 4 and June 13, 2018 (PDF)

April 23 and May 2, 2018 (PDF)

February 26 through March 21, 2018 (PDF)

January 22 and January 31, 2018 (PDF)

December 4 and December 13, 2017 (PDF)

October 10 through November 1, 2017 (PDF)

August 28 and September 20, 2017 (PDF)

July 17 and July 26, 2017 (PDF)

June 5 and June 14, 2017 (PDF)

March 27 through May 3, 2017 (PDF)

February 13 through March 15, 2017 (PDF)

January 23 and February 1, 2017 (PDF)

November 14 through December 14, 2016 (PDF)

October 11 and October 31, 2016 (PDF)

August 29 and September 19, 2016 (PDF)

July 25, 2016 (PDF)

May 23 and June 13, 2016 (PDF)

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Last Update: January 09, 2020