fed funds


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Federal Funds

Money that a commercial bank in the United States has in excess of its reserve requirement. Banks deposit their federal funds at the Federal Reserve Bank of their district. Federal funds are available for lending to other banks on an overnight basis. The amount of federal funds is seen as a signal of the state of American credit markets, with more money available signaling loose credit and a less indicating the opposite. See also: Federal Funds Rate.

fed funds

References in periodicals archive ?
The Fed funds and T-bill rates are the monthly average of daily rates.
Before you decide on whether to invest in short- or long-term bonds, Lay recommends that you first check out the yield on the Fed funds rate, a benchmark for bond investors, which is currently 5.
com), projects deposit rates will remain low in 2011 mainly because the Fed Funds rate is expected to remain at its current level (0-0.
If the United States can cool its housing market with a Fed funds rate of only 5 percent, it will greatly increase the odds of the American economy enjoying a soft landing during 2006 and 2007.
Options on CBOT fed funds futures are quite possibly the best means available to express market opinions about what the Fed might or might not do at the upcoming meetings.
There is a negative correlation between the fed funds rate and the price-earnings ratio, but it arises from a significant correlation of each measure with inflation.
Program users are permitted to sell federal funds while they are borrowing seasonal credit, as long as net fed funds sales (fed funds sold less fed funds purchased) do not exceed the bank's normal operating pattern, that is, the pattern that existed before the bank became a seasonal borrower.
The Fed has hacked the Fed Funds rate by 75 basis points to 0.
Eurodollar and fed funds futures represent a bet on the risk associated with short-run interest rate changes.
Conrad believes that the Fed has already effectively cut the Fed Funds rate.
short-term interest rates at extraordinary lows (at one point the Fed funds rate was set at 1 percent), financial institutions would borrow on the short end of the yield curve and buy the long end, guaranteeing a nice profit even before taking any risk.
Says Shafer: "If I'm investing cash overnight, and I'm a major company, I'm likely to view the fed funds rate as the maximum [return] I can hope for.