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
   2026-08-07: 7757.64013672 USD
with:
   US Fed Discount Rate
   US: DISC
   2026-08-07: 3.75000000 USD

                S&P 500        US Fed Discount Rat
               ^GSPC  Growth%        DISC  Growth%
           ---------- -------   ---------- -------
2026-08-07   7,757.64  100.00         3.75  100.00
2026-08-06   7,709.96   99.39         3.75  100.00
2026-08-05   7,723.55   99.56         3.75  100.00
2026-08-04   7,736.52   99.73         3.75  100.00
2026-08-03   7,600.50   97.97         3.75  100.00
2026-07-31   7,489.72   96.55         3.75  100.00
2026-07-30   7,437.63   95.87         3.75  100.00
2026-07-29   7,316.15   94.31         3.75  100.00
2026-07-28   7,428.78   95.76         3.75  100.00
2026-07-27   7,413.18   95.56         3.75  100.00
2026-07-24   7,411.98   95.54         3.75  100.00
2026-07-23   7,408.30   95.50         3.75  100.00
2026-07-22   7,498.96   96.67         3.75  100.00
2026-07-21   7,509.20   96.80         3.75  100.00
2026-07-20   7,443.28   95.95         3.75  100.00
2026-07-17   7,457.69   96.13         3.75  100.00
2026-07-16   7,533.77   97.11         3.75  100.00
2026-07-15   7,572.40   97.61         3.75  100.00
2026-07-14   7,543.59   97.24         3.75  100.00
2026-07-13   7,515.34   96.88         3.75  100.00
2026-07-10   7,575.39   97.65         3.75  100.00
2026-07-07   7,503.85   96.73         3.75  100.00
2026-06-07   7,383.74   95.18         3.75  100.00
2026-05-07   7,337.11   94.58         3.75  100.00
2026-04-07   6,616.85   85.29         3.75  100.00
2026-03-07   6,740.02   86.88         3.75  100.00
2026-02-07   6,932.30   89.36         3.75  100.00
2026-01-07   6,920.93   89.21         3.75  100.00
2025-12-07   6,870.40   88.56         4.00  106.67
2025-11-07   6,728.80   86.74         4.00  106.67
2025-10-07   6,714.59   86.55         4.25  113.33
2025-09-07   6,481.50   83.55         4.50  120.00
2025-08-07   6,340.00   81.73         4.50  120.00
2024-08-07   5,199.50   67.02         5.50  146.67
2023-08-07   4,518.44   58.25         5.50  146.67
2022-08-07   4,145.19   53.43         2.50   66.67
2021-08-07   4,436.52   57.19         0.25    6.67
2020-08-07   3,351.28   43.20         0.25    6.67
2019-08-07   2,883.98   37.18         2.75   73.33
2018-08-07   2,858.45   36.85         2.50   66.67
2017-08-07   2,480.91   31.98         1.75   46.67
2016-08-07   2,182.87   28.14         1.00   26.67
2015-08-07   2,077.57   26.78         0.75   20.00
2014-08-07   2,003.37   25.82         0.75   20.00
2013-08-07   1,632.97   21.05         0.75   20.00
2012-08-07   1,406.58   18.13         0.75   20.00
2011-08-07   1,218.89   15.71         0.75   20.00
2010-08-07   1,049.33   13.53         0.75   20.00
2009-08-07   1,020.62   13.16         0.50   13.33
2008-08-07   1,282.83   16.54         2.25   60.00
2007-08-07   1,473.99   19.00         6.25  166.67
2006-08-07   1,303.82   16.81         6.25  166.67
2005-08-07   1,220.33   15.73         4.25  113.33
2004-08-07   1,104.24   14.23         2.25   60.00
2003-08-07   1,008.01   12.99         2.00   53.33
2002-08-07     916.07   11.81                     
2001-08-07   1,133.58   14.61                     
2000-08-07   1,517.68   19.56                     
1999-08-07   1,320.41   17.02                     
1998-08-07     957.28   12.34                     
1997-08-07     899.47   11.59                     
1996-08-07     651.99    8.40                     
1995-08-07     561.88    7.24                     
1994-08-07     475.49    6.13                     
1993-08-07     463.56    5.98                     
1992-08-07     414.03    5.34                     
1991-08-07     395.43    5.10                     
1990-08-07     322.56    4.16                     
1989-08-07     351.45    4.53                     
1988-08-07     261.52    3.37                     
1987-08-07     329.80    4.25                     
1986-08-07     252.93    3.26                     
1985-08-07     188.63    2.43                     
1984-12-01     181.18    2.34                     

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