Current prime rate: 7.00% (September 2026)
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Current Prime Rate
What Is the Prime Rate Today?
Key Facts
- Current prime rate: 7.00% (effective September 17, 2026)
- Previous prime rate: 6.75% (December 11, 2025 – September 16, 2026)
- Federal funds rate: 3.75%–4.00% target range
- Formula: Prime rate = Fed funds rate upper bound (4.00%) + 3.00% = 7.00%
- Rate trend: First hike since 2023 (+0.25% on September 16, 2026); prime rose from 6.75% to 7.00%
- Most recent decision: September 16, 2026 — FOMC voted to raise the target range by 25 bps to 3.75%–4.00%, the first increase since 2023. Next FOMC: October 27–28, 2026.
On This Page
- Today’s Prime Rate Explained
- Prime Rate by Bank
- Recent Rate Changes Timeline
- How Today’s Rate Affects You
- What Happens Next: FOMC Outlook
- What Is the Current Federal Funds Rate?
- When Will Interest Rates Go Down?
- Will the Fed Raise Rates in 2026?
- How Often Does the Prime Rate Change?
- What Drives Changes to the Prime Rate?
- Frequently Asked Questions
Today’s Prime Rate Explained
The prime rate at 7.00% means that the nation’s largest banks charge their most creditworthy corporate customers 7.00% for short-term operating loans. For consumers and small businesses, the prime rate is a benchmark — your actual rate is prime plus a margin based on your credit profile. The CFPB explains that the margin depends on the product type and your creditworthiness.
At 7.00% prime, here is what you are paying right now:
- Credit cards: 19.00%–30.00% APR (prime + 12%–23% margin). The average is about 21% per Federal Reserve G.19 data.
- HELOCs: 7.50%–9.00% APR (prime + 0.5%–2%).
- SBA 7(a) loans: 9.25%–11.75% APR (prime + 2.25%–4.75%). See SBA rate caps.
- Adjustable-rate mortgages: 7.00%–8.00% APR (prime + 0%–1%).
- Business lines of credit: 7.8%–25% APR depending on lender and credit.
Use the Prime Rate Impact Calculator to see the exact effect on your specific loan balance.
Prime Rate by Bank
The Wall Street Journal prime rate is based on a survey of the 30 largest U.S. banks. In practice, all major banks post the same prime rate because it is mechanically tied to the federal funds rate. As of September 2026:
| Bank | Prime Rate | Effective Date |
|---|---|---|
| JPMorgan Chase | 7.00% | Sep 17, 2026 |
| Bank of America | 7.00% | Sep 17, 2026 |
| Wells Fargo | 7.00% | Sep 17, 2026 |
| Citibank | 7.00% | Sep 17, 2026 |
| U.S. Bank | 7.00% | Sep 17, 2026 |
| PNC Financial | 7.00% | Sep 17, 2026 |
| Goldman Sachs | 7.00% | Sep 17, 2026 |
| TD Bank | 7.00% | Sep 17, 2026 |
While the WSJ prime rate is uniform across major banks, some smaller community banks and credit unions may post a slightly different rate. These differences are typically 0.25% or less and apply only to specific local products. For consumer and small business lending, the 7.00% WSJ prime rate is the standard benchmark used by virtually all lenders nationwide.
Recent Rate Changes Timeline
After five cuts across 2024–2025, the Fed reversed course on September 16, 2026 with its first hike since 2023, raising prime to 7.00%. Here is the recent timeline, based on FRED historical data:
| FOMC Date | Fed Action | Fed Funds Rate | Prime Rate | Change |
|---|---|---|---|---|
| Sep 16, 2026 | ↑ Raise 0.25% | 3.75%–4.00% | 7.00% | ↑ 0.25% |
| Dec 10, 2025 | ↓ Cut 0.25% | 3.50%–3.75% | 6.75% | ↓ 0.25% |
| Oct 29, 2025 | ↓ Cut 0.25% | 3.75%–4.00% | 7.00% | ↓ 0.25% |
| Jun 11, 2025 | ↓ Cut 0.25% | 4.00%–4.25% | 7.25% | ↓ 0.25% |
| Nov 7, 2024 | ↓ Cut 0.25% | 4.25%–4.50% | 7.50% | ↓ 0.25% |
| Sep 18, 2024 | ↓ Cut 0.50% | 4.50%–4.75% | 8.00% | ↓ 0.50% |
| Jul 2023 (last hike) | ↑ Raise 0.25% | 5.25%–5.50% | 8.50% | ↑ 0.25% |
For the complete history back to 1980, see our Prime Rate History page and the interactive Prime Rate Forecast Calculator.
How Today’s 7.00% Rate Affects You
After five cuts brought prime from 8.50% down to 6.75%, the September 2026 hike nudged it back up to 7.00%. Here is where borrowing costs on common variable-rate balances stand now versus the 8.50% peak:
| Product | Balance | Old Rate (8.50% prime) | Current Rate (7.00% prime) | Annual Savings vs Peak |
|---|---|---|---|---|
| Credit card (prime+16%) | $5,000 | 24.50% | 23.00% | $75/yr |
| HELOC (prime+1%) | $80,000 | 9.50% | 8.00% | $1,200/yr |
| SBA 7(a) (prime+2.75%) | $200,000 | 11.25% | 9.75% | $3,000/yr |
| ARM (prime+0.5%) | $350,000 | 9.00% | 7.50% | $5,250/yr |
| Business LOC (prime+8%) | $50,000 | 16.50% | 15.00% | $750/yr |
Model your exact savings with the Prime Rate Impact Calculator or compare variable vs fixed rates using the Variable vs Fixed Rate Calculator.
What Happens Next: FOMC Outlook
The Federal Reserve’s September 15–16, 2026 FOMC meeting concluded on September 16 with a decision to raise the target range by 25 basis points to 3.75%–4.00% — its first hike since 2023. The next meeting is October 27–28, 2026. Based on CME FedWatch probabilities and FOMC projections:
October 27–28, 2026: Markets currently price meaningful odds of a follow-up 25-basis-point hike, reflecting the Committee’s hawkish shift in September. Incoming inflation data will be the deciding factor. If inflation stays elevated, another increase would lift prime to 7.25%.
December 8–9, 2026: Carries the next Summary of Economic Projections. Futures point toward the target range near 4.00%–4.25% by year-end; a further hike here would push prime to 7.25%.
Into 2027: The path depends on inflation. If price pressures persist, additional hikes are possible; if inflation cools back toward 2%, the Fed could pause. Markets are no longer pricing cuts in the near term.
What this means for borrowers: The direction of rates has turned higher — prime is now more likely to rise than fall in the near term. If you carry variable-rate debt (HELOC, SBA loan, business LOC), locking a fixed rate can protect you from further increases. If inflation cools faster than expected, the Fed could pause. Read our full analysis: Prime Rate Forecast 2026.
What Is the Current Federal Funds Rate?
The current federal funds rate target range is 3.75%–4.00%, set by the Federal Open Market Committee (FOMC) at its September 15–16, 2026 meeting. The effective federal funds rate — the actual overnight rate banks charge each other — is moving up into the new corridor from its pre-hike level near 3.63%. The September increase was the Fed’s first rate hike since 2023.
The federal funds rate directly determines the prime rate through a fixed 3.00% spread. When the FOMC raises or lowers the fed funds target, every major U.S. bank adjusts its prime rate by the same amount, typically within one business day. At today’s target of 3.75%–4.00%, the prime rate formula yields 7.00% (upper bound of 4.00% + 3.00%).
For borrowers, the fed funds rate is the single most important number in the economy. It flows directly into credit card APRs, HELOCs, adjustable-rate mortgages, and auto loans. You can track the latest fed funds rate data on the FRED database or on our Fed Prime Rate Dashboard.
When Will Interest Rates Go Down?
After cutting five times between September 2024 and December 2025, the Fed reversed course on September 16, 2026, raising the target range by 25 basis points to 3.75%–4.00% — its first hike since 2023 — and lifting the prime rate to 7.00%. For now, rates are moving up rather than down as the Committee responds to persistent inflation. The next FOMC meeting is October 27–28, 2026.
Looking ahead, CME FedWatch futures now lean toward the target range holding or rising further, with the possibility of another quarter-point hike before year-end that would take prime to 7.25%. The key factors the Fed is watching are inflation (CPI at 3.4% year-over-year, still above the 2% target), labor market conditions, and consumer spending data.
For a detailed timeline and rate projections, see our Prime Rate Forecast 2026 and Fed Meeting Schedule pages, which are updated after every FOMC decision.
Will the Fed Raise Rates in 2026?
The Fed has already raised rates in 2026: on September 16 it lifted the target range by 25 basis points to 3.75%–4.00%, its first hike since 2023. Fed funds futures now assign meaningful odds to at least one more increase before year-end, and the Fed’s latest Summary of Economic Projections signals a bias toward further tightening rather than easing if inflation stays elevated.
The scenario that would push rates higher still is inflation staying persistently above target — for example, core inflation holding near or above current levels on tariff-driven or energy-price pressures. If instead inflation cools convincingly toward 2%, the Fed could pause. Chair Warsh has stressed that the Committee wants to see “sustained progress” toward 2% inflation before easing again.
How Often Does the Prime Rate Change?
The prime rate only changes when the Federal Reserve adjusts its federal funds rate target — and the FOMC meets just eight times per year. Between meetings, the prime rate stays fixed. In practice, the prime rate changed multiple times in 2024–2025 during the easing cycle, then rose again on September 16, 2026 — the first hike since 2023. Historically, there have been years with zero changes (2015, 2020–2021) and years with seven or more (2022 had seven consecutive hikes).
When the Fed does change rates, banks update the prime rate within one business day — usually the day after the FOMC announcement at 2:00 PM ET. The adjustment is always in the same increment as the Fed’s move (typically 0.25%). If you carry variable-rate debt tied to prime, your payment amount will adjust on the next billing cycle after the rate change takes effect. Check our Fed Meeting Schedule to see when the next potential change could happen.
What Drives Changes to the Prime Rate?
The prime rate is driven by exactly one factor: the federal funds rate set by the FOMC. The formula is simple — prime rate equals the upper bound of the fed funds target plus 3.00%. This 3% spread has been constant since 1994. No bank sets its own prime rate independently; they all follow the Fed’s lead within 24 hours of an announcement.
But what drives the Fed’s decision? The FOMC weighs three primary factors: inflation (measured by CPI and PCE), employment (monthly jobs reports, unemployment rate), and overall economic growth (GDP). When inflation runs hot, the Fed raises rates to cool spending. When the economy weakens or unemployment rises, the Fed cuts rates to stimulate borrowing. The Treasury yield curve also provides a real-time signal of market expectations for future Fed policy.
For consumers, understanding this chain reaction is key: inflation data → Fed decision → prime rate change → your loan payment changes. By watching the economic indicators we track on our Interest Rates Dashboard, you can anticipate rate moves before they happen and plan your borrowing or refinancing accordingly.
Frequently Asked Questions
What is the current prime rate today?
The current U.S. prime rate is 7.00% as of September 2026, effective since September 17, 2026 after the Fed raised rates for the first time since 2023. The prime rate is calculated as the federal funds rate upper bound (currently 4.00%) plus a fixed 3-percentage-point spread that has held since 1994. The Wall Street Journal publishes the official prime rate based on a survey of the 30 largest U.S. banks, and in practice all major banks post the same rate. At 7.00%, prime sits below its recent peak of 8.50% in mid-2024, but it has just risen for the first time in two years as the Fed shifts to tightening.
When did the prime rate last change?
The prime rate last changed on September 17, 2026, rising from 6.75% to 7.00% after the Fed raised the federal funds rate by 25 basis points at its September 15–16 FOMC meeting. This was the first hike since 2023 and reversed a run of five cuts between September 2024 and December 2025. Before that, the previous change was December 11, 2025 (7.00% to 6.75%). You can track the full history of rate changes on our Fed Meeting Schedule page, which shows every FOMC decision alongside its impact on the prime rate.
When will the prime rate change again?
The September 15–16, 2026 FOMC meeting concluded on September 16 with the Fed raising rates by 25 basis points to 3.75%–4.00% — lifting the prime rate to 7.00%. The next FOMC meeting is October 27–28, 2026; with the Committee signaling further tightening is possible, markets see meaningful odds of another increase. If the Fed hikes by 25 basis points again, prime would rise to 7.25% within one business day. The actual timing hinges on inflation data — the Fed wants to see inflation cooling back toward 2% before it pauses, so upcoming CPI readings will be the key data points to watch.
Is the prime rate the same at every bank?
Effectively yes. All 30 major banks surveyed by the Wall Street Journal — including JPMorgan Chase, Bank of America, Wells Fargo, and Citibank — post the same prime rate of 7.00%. The uniformity exists because every bank pegs its prime rate to the federal funds rate using the same formula (fed funds upper bound + 3%). Some smaller community banks or credit unions may deviate by up to 0.25%, but for consumer and business lending purposes, the WSJ prime rate is the universal benchmark that drives credit card APRs, HELOCs, SBA loans, and other variable-rate products nationwide.
How does the prime rate affect my credit card?
Most credit card APRs are calculated as the prime rate plus a fixed margin that depends on your creditworthiness, typically 12%–23%. At the current prime rate of 7.00% with a typical 16% margin, your APR would be 23.00%. Prime just rose 0.25 percentage point in September 2026, which adds about $12 per year in interest on a $5,000 balance — and further hikes would add more. Credit card rates adjust on your next billing cycle after a prime rate change — you don’t need to do anything. To see how future Fed moves could affect your specific balance, try our Prime Rate Impact Calculator.
What is the relationship between the prime rate and the federal funds rate?
The prime rate equals the federal funds rate upper bound plus a fixed 3-percentage-point spread — a relationship that has held since 1994. With the current fed funds target at 3.75%–4.00%, the upper bound of 4.00% plus 3.00% gives you a prime rate of 7.00%. When the FOMC raises or lowers the federal funds rate, banks adjust their posted prime rate by the same amount within one business day — there is no lag or discretion involved. This mechanical link means that tracking the FOMC meeting schedule and the CME FedWatch Tool tells you exactly when and by how much prime is likely to change next.
What is the current federal funds rate?
The current federal funds rate target range is 3.75%–4.00%, set by the FOMC at its September 15–16, 2026 meeting. This is the rate at which banks lend reserves to each other overnight and serves as the benchmark for nearly all U.S. interest rates. After cutting five times between September 2024 and December 2025, the Fed raised rates in September 2026 for the first time since 2023. The Federal Reserve H.15 release publishes the effective federal funds rate daily. The prime rate is always 3 percentage points above the upper bound, which is why prime sits at 7.00% today.
When will interest rates go down?
The Fed’s September 2026 projections lean toward the target range holding or rising further, not falling. After the September hike to 3.75%–4.00%, futures markets see meaningful odds of another 25-basis-point increase before year-end, which would take the prime rate to 7.25%. The actual timing depends on inflation: rates are more likely to rise or hold until inflation cools convincingly toward the Fed’s 2% target. Track real-time probabilities at the CME FedWatch Tool, and see our Fed Meeting Schedule for upcoming decision dates.
Related Resources
- The Prime Rate: Complete Guide — How it works and why it matters
- Prime Rate Forecast 2026 — Where rates are headed
- How the Prime Rate Affects Your Loans
- Prime Rate vs Federal Funds Rate vs SOFR
- Prime Rate History Since 1980
References
- Federal Reserve — H.15 Selected Interest Rates
- Federal Reserve — FOMC Statements and Minutes
- Federal Reserve — FOMC Meeting Calendar
- Federal Reserve — G.19 Consumer Credit
- FRED — Bank Prime Loan Rate Historical Data
- CFPB — Credit Reports and Scores
- CFPB — Small Business Lending
- SBA — 7(a) Loan Program Rate Caps
- CME Group — FedWatch Tool
- FDIC — Quarterly Banking Profile
Calculators
- Prime Rate Impact Calculator
- Credit Card Calculator
- Loan Payment Calculator
- Savings Calculator
- Variable vs Fixed Rate Calculator
- Rate History & Forecast Calculator