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
   2026-08-21: 7674.37011719 USD
with:
   US Fed Discount Rate
   US: DISC
   2026-08-21: 3.75000000 USD

                S&P 500        US Fed Discount Rat
               ^GSPC  Growth%        DISC  Growth%
           ---------- -------   ---------- -------
2026-08-21   7,674.37  100.00         3.75  100.00
2026-08-20   7,641.16   99.57         3.75  100.00
2026-08-19   7,707.98  100.44         3.75  100.00
2026-08-18   7,691.76  100.23         3.75  100.00
2026-08-17   7,745.06  100.92         3.75  100.00
2026-08-14   7,785.76  101.45         3.75  100.00
2026-08-13   7,798.99  101.62         3.75  100.00
2026-08-12   7,748.50  100.97         3.75  100.00
2026-08-11   7,728.20  100.70         3.75  100.00
2026-08-10   7,753.11  101.03         3.75  100.00
2026-08-07   7,757.64  101.09         3.75  100.00
2026-08-06   7,709.96  100.46         3.75  100.00
2026-08-05   7,723.55  100.64         3.75  100.00
2026-08-04   7,736.52  100.81         3.75  100.00
2026-08-03   7,600.50   99.04         3.75  100.00
2026-07-31   7,489.72   97.59         3.75  100.00
2026-07-30   7,437.63   96.92         3.75  100.00
2026-07-29   7,316.15   95.33         3.75  100.00
2026-07-28   7,428.78   96.80         3.75  100.00
2026-07-27   7,413.18   96.60         3.75  100.00
2026-07-24   7,411.98   96.58         3.75  100.00
2026-07-21   7,509.20   97.85         3.75  100.00
2026-06-21   7,500.58   97.74         3.75  100.00
2026-05-21   7,445.72   97.02         3.75  100.00
2026-04-21   7,064.01   92.05         3.75  100.00
2026-03-21   6,506.48   84.78         3.75  100.00
2026-02-21   6,909.51   90.03         3.75  100.00
2026-01-21   6,875.62   89.59         3.75  100.00
2025-12-21   6,834.50   89.06         3.75  100.00
2025-11-21   6,602.99   86.04         4.00  106.67
2025-10-21   6,735.35   87.76         4.25  113.33
2025-09-21   6,664.36   86.84         4.25  113.33
2025-08-21   6,370.17   83.01         4.50  120.00
2024-08-21   5,620.85   73.24         5.50  146.67
2023-08-21   4,399.77   57.33         5.50  146.67
2022-08-21   4,228.48   55.10         2.50   66.67
2021-08-21   4,441.67   57.88         0.25    6.67
2020-08-21   3,397.16   44.27         0.25    6.67
2019-08-21   2,924.43   38.11         2.75   73.33
2018-08-21   2,862.96   37.31         2.50   66.67
2017-08-21   2,428.37   31.64         1.75   46.67
2016-08-21   2,183.87   28.46         1.00   26.67
2015-08-21   1,970.89   25.68         0.75   20.00
2014-08-21   2,003.37   26.10         0.75   20.00
2013-08-21   1,632.97   21.28         0.75   20.00
2012-08-21   1,406.58   18.33         0.75   20.00
2011-08-21   1,218.89   15.88         0.75   20.00
2010-08-21   1,049.33   13.67         0.75   20.00
2009-08-21   1,020.62   13.30         0.50   13.33
2008-08-21   1,282.83   16.72         2.25   60.00
2007-08-21   1,473.99   19.21         5.75  153.33
2006-08-21   1,303.82   16.99         6.25  166.67
2005-08-21   1,220.33   15.90         4.50  120.00
2004-08-21   1,104.24   14.39         2.50   66.67
2003-08-21   1,008.01   13.13         2.00   53.33
2002-08-21     916.07   11.94                     
2001-08-21   1,133.58   14.77                     
2000-08-21   1,517.68   19.78                     
1999-08-21   1,320.41   17.21                     
1998-08-21     957.28   12.47                     
1997-08-21     899.47   11.72                     
1996-08-21     651.99    8.50                     
1995-08-21     561.88    7.32                     
1994-08-21     475.49    6.20                     
1993-08-21     463.56    6.04                     
1992-08-21     414.03    5.39                     
1991-08-21     395.43    5.15                     
1990-08-21     322.56    4.20                     
1989-08-21     351.45    4.58                     
1988-08-21     261.52    3.41                     
1987-08-21     329.80    4.30                     
1986-08-21     252.93    3.30                     
1985-08-21     188.63    2.46                     
1984-12-01     181.18    2.36                     

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