What Is the Relationship Between S&P 500 Index and US Fed Discount Interest Rates?

The Relationship Between S&P 500 Index and US Fed Discount Interest Rates can be summarized as:

• Interest rates tend to negatively affect the S&P 500 Index.
• Central banks raise interest rates to cool the economy which decreases the S&P 500 Index.
• Central banks lower interest rates to stimulate the economy which increases the S&P 500 Index.

Compare:
   S&P 500
   SNP: ^GSPC
   2025-12-10: 6886.68017578 USD
with:
   US Fed Discount Rate
   US: DISC
   2025-12-10: 4.00000000 USD

                S&P 500        US Fed Discount Rat
               ^GSPC  Growth%        DISC  Growth%
           ---------- -------   ---------- -------
2025-12-10   6,886.68  100.00         4.00  100.00
2025-12-09   6,840.51   99.33         4.00  100.00
2025-12-08   6,846.51   99.42         4.00  100.00
2025-12-05   6,870.40   99.76         4.00  100.00
2025-12-04   6,857.12   99.57         4.00  100.00
2025-12-03   6,849.72   99.46         4.00  100.00
2025-12-02   6,829.37   99.17         4.00  100.00
2025-12-01   6,812.63   98.92         4.00  100.00
2025-11-28   6,849.09   99.45         4.00  100.00
2025-11-26   6,812.61   98.92         4.00  100.00
2025-11-25   6,765.88   98.25         4.00  100.00
2025-11-24   6,705.12   97.36         4.00  100.00
2025-11-21   6,602.99   95.88         4.00  100.00
2025-11-20   6,538.76   94.95         4.00  100.00
2025-11-19   6,642.16   96.45         4.00  100.00
2025-11-18   6,617.32   96.09         4.00  100.00
2025-11-17   6,672.41   96.89         4.00  100.00
2025-11-14   6,734.11   97.78         4.00  100.00
2025-11-13   6,737.49   97.83         4.00  100.00
2025-11-12   6,850.92   99.48         4.00  100.00
2025-11-10   6,832.43   99.21         4.00  100.00
2025-10-10   6,552.51   95.15         4.25  106.25
2025-09-10   6,532.04   94.85         4.50  112.50
2025-08-10   6,389.45   92.78         4.50  112.50
2025-07-10   6,280.46   91.20         4.50  112.50
2025-06-10   6,038.81   87.69         4.50  112.50
2025-05-10   5,659.91   82.19         4.50  112.50
2025-04-10   5,268.05   76.50         4.50  112.50
2025-03-10   5,614.56   81.53         4.50  112.50
2025-02-10   6,066.44   88.09         4.50  112.50
2025-01-10   5,827.04   84.61         4.50  112.50
2024-12-10   6,034.91   87.63         4.75  118.75
2023-12-10   4,604.37   66.86         5.50  137.50
2022-12-10   3,934.38   57.13         4.00  100.00
2021-12-10   4,712.02   68.42         0.25    6.25
2020-12-10   3,668.10   53.26         0.25    6.25
2019-12-10   3,132.52   45.49         2.25   56.25
2018-12-10   2,637.72   38.30         2.75   68.75
2017-12-10   2,651.50   38.50         1.75   43.75
2016-12-10   2,259.53   32.81         1.00   25.00
2015-12-10   2,052.23   29.80         0.75   18.75
2014-12-10   2,104.50   30.56         0.75   18.75
2013-12-10   1,859.45   27.00         0.75   18.75
2012-12-10   1,514.68   21.99         0.75   18.75
2011-12-10   1,365.68   19.83         0.75   18.75
2010-12-10   1,327.22   19.27         0.75   18.75
2009-12-10   1,104.49   16.04         0.50   12.50
2008-12-10     735.09   10.67         1.25   31.25
2007-12-10   1,330.63   19.32         5.00  125.00
2006-12-10   1,406.82   20.43         6.25  156.25
2005-12-10   1,280.66   18.60         5.00  125.00
2004-12-10   1,203.60   17.48         3.00   75.00
2003-12-10   1,144.94   16.63         2.00   50.00
2002-12-10     841.15   12.21                     
2001-12-10   1,106.73   16.07                     
2000-12-10   1,239.94   18.00                     
1999-12-10   1,366.42   19.84                     
1998-12-10   1,238.33   17.98                     
1997-12-10   1,049.34   15.24                     
1996-12-10     790.82   11.48                     
1995-12-10     640.43    9.30                     
1994-12-10     487.39    7.08                     
1993-12-10     467.14    6.78                     
1992-12-10     443.38    6.44                     
1991-12-10     412.70    5.99                     
1990-12-10     367.07    5.33                     
1989-12-10     331.89    4.82                     
1988-12-10     288.86    4.19                     
1987-12-10     267.82    3.89                     
1986-12-10     284.20    4.13                     
1985-12-10     226.92    3.30                     
1984-12-10     181.18    2.63                     
1984-12-01     181.18    2.63                     

As you can see, when US inflation rate went up above 8% in 2022, US Fed raised the Discount Rate from 0.25% to 5.50% in about 1 year. This helped to bring the inflation rate down to 3% in 2023.

⇒ Cboe Indices: ^VIX - CBOE Volatility Index

⇐ SNP: ^GSPC - Standard and Poor's 500

⇑ US Market Indices

⇑⇑ Market Indices