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
   2025-12-05: 6870.39990234 USD
with:
   US Fed Discount Rate
   US: DISC
   2025-12-05: 4.00000000 USD

                S&P 500        US Fed Discount Rat
               ^GSPC  Growth%        DISC  Growth%
           ---------- -------   ---------- -------
2025-12-05   6,870.40  100.00         4.00  100.00
2025-12-04   6,857.12   99.81         4.00  100.00
2025-12-03   6,849.72   99.70         4.00  100.00
2025-12-02   6,829.37   99.40         4.00  100.00
2025-12-01   6,812.63   99.16         4.00  100.00
2025-11-28   6,849.09   99.69         4.00  100.00
2025-11-26   6,812.61   99.16         4.00  100.00
2025-11-25   6,765.88   98.48         4.00  100.00
2025-11-24   6,705.12   97.59         4.00  100.00
2025-11-21   6,602.99   96.11         4.00  100.00
2025-11-20   6,538.76   95.17         4.00  100.00
2025-11-19   6,642.16   96.68         4.00  100.00
2025-11-18   6,617.32   96.32         4.00  100.00
2025-11-17   6,672.41   97.12         4.00  100.00
2025-11-14   6,734.11   98.02         4.00  100.00
2025-11-13   6,737.49   98.07         4.00  100.00
2025-11-12   6,850.92   99.72         4.00  100.00
2025-11-11   6,846.61   99.65         4.00  100.00
2025-11-10   6,832.43   99.45         4.00  100.00
2025-11-07   6,728.80   97.94         4.00  100.00
2025-11-05   6,796.29   98.92         4.00  100.00
2025-10-05   6,715.79   97.75         4.25  106.25
2025-09-05   6,481.50   94.34         4.50  112.50
2025-08-05   6,299.19   91.69         4.50  112.50
2025-07-05   6,279.35   91.40         4.50  112.50
2025-06-05   5,939.30   86.45         4.50  112.50
2025-05-05   5,650.38   82.24         4.50  112.50
2025-04-05   5,074.08   73.85         4.50  112.50
2025-03-05   5,842.63   85.04         4.50  112.50
2025-02-05   6,061.48   88.23         4.50  112.50
2025-01-05   5,942.47   86.49         4.50  112.50
2024-12-05   6,075.11   88.42         4.75  118.75
2023-12-05   4,567.18   66.48         5.50  137.50
2022-12-05   3,998.84   58.20         4.00  100.00
2021-12-05   4,538.43   66.06         0.25    6.25
2020-12-05   3,699.12   53.84         0.25    6.25
2019-12-05   3,117.43   45.37         2.25   56.25
2018-12-05   2,700.06   39.30         2.75   68.75
2017-12-05   2,629.57   38.27         1.75   43.75
2016-12-05   2,204.71   32.09         1.00   25.00
2015-12-05   2,091.69   30.44         0.75   18.75
2014-12-05   2,104.50   30.63         0.75   18.75
2013-12-05   1,859.45   27.06         0.75   18.75
2012-12-05   1,514.68   22.05         0.75   18.75
2011-12-05   1,365.68   19.88         0.75   18.75
2010-12-05   1,327.22   19.32         0.75   18.75
2009-12-05   1,104.49   16.08         0.50   12.50
2008-12-05     735.09   10.70         1.25   31.25
2007-12-05   1,330.63   19.37         5.00  125.00
2006-12-05   1,406.82   20.48         6.25  156.25
2005-12-05   1,280.66   18.64         5.00  125.00
2004-12-05   1,203.60   17.52         3.00   75.00
2003-12-05   1,144.94   16.66         2.00   50.00
2002-12-05     841.15   12.24                     
2001-12-05   1,106.73   16.11                     
2000-12-05   1,239.94   18.05                     
1999-12-05   1,366.42   19.89                     
1998-12-05   1,238.33   18.02                     
1997-12-05   1,049.34   15.27                     
1996-12-05     790.82   11.51                     
1995-12-05     640.43    9.32                     
1994-12-05     487.39    7.09                     
1993-12-05     467.14    6.80                     
1992-12-05     443.38    6.45                     
1991-12-05     412.70    6.01                     
1990-12-05     367.07    5.34                     
1989-12-05     331.89    4.83                     
1988-12-05     288.86    4.20                     
1987-12-05     267.82    3.90                     
1986-12-05     284.20    4.14                     
1985-12-05     226.92    3.30                     
1984-12-05     181.18    2.64                     
1984-12-01     181.18    2.64                     

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