Survey time period: January 2018 to September 2026
The inflation rate in the United States declined significantly between June 2022 and September 2025, despite rising inflationary pressures towards the end of 2024. The peak inflation rate was recorded in June 2022, at percent. In August 2023, the Federal Reserve's interest rate hit its highest level during the observed period, at percent, and remained unchanged until September 2024, when the Federal Reserve implemented its first rate cut since September 2021. By September 2026, the rate had increased to percent.
What is the Federal Reserve interest rate?
The Federal Reserve interest rate, or the federal funds rate, is the rate at which banks and credit unions lend to and borrow from each other. It is one of the Federal Reserve's key tools for maintaining strong employment rates, stable prices, and reasonable interest rates. The rate is determined by the Federal Reserve and adjusted eight times a year, though it can be changed through emergency meetings during times of crisis. The Fed doesn't directly control the interest rate but sets a target rate. It then uses open market operations to influence rates toward this target.
Ways of measuring inflation
Inflation is typically measured using several methods, with the most common being the Consumer Price Index (CPI). The CPI tracks the price of a fixed basket of goods and services over time, providing a measure of the price changes consumers face. By mid 2024, the CPI in the United States was percent, up from a year earlier. A more business-focused measure is the producer price index (PPI), which represents the costs of firms.