Current prime rate: 6.75% (April 2026)

Today’s Prime Rate Explained

The prime rate at 6.75% means that the nation’s largest banks charge their most creditworthy corporate customers 6.75% 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 6.75% prime, here is what you are paying right now:

• Credit cards: 18.75%–29.75% APR (prime + 12%–23% margin). The average is 20.97% per Federal Reserve G.19 data.
• HELOCs: 7.25%–8.75% APR (prime + 0.5%–2%).
• SBA 7(a) loans: 9.00%–11.50% APR (prime + 2.25%–4.75%). See SBA rate caps.
• Adjustable-rate mortgages: 6.75%–7.75% 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 April 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 6.75% or less and apply only to specific local products. For consumer and small business lending, the 6.75% WSJ prime rate is the standard benchmark used by virtually all lenders nationwide.

Recent Rate Changes Timeline

The Fed has cut rates five times since September 2024, each time reducing prime by the same amount. Here is the complete timeline of the current easing cycle, based on FRED historical data:

For the complete history back to 1980, see our Prime Rate History page and the interactive Prime Rate Forecast Calculator.

How Today’s 6.75% Rate Affects You

The drop from 8.50% to 6.75% since September 2024 has reduced borrowing costs across every variable-rate product. Here is the dollar impact on common loan balances:

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 next rate decision comes at the April 28–29, 2026 FOMC meeting. Based on CME FedWatch probabilities and FOMC dot-plot projections:

April 28–29, 2026: Markets price ~85% probability of hold. Inflation data from Q1 2026 will be the deciding factor. If core PCE remains above 2.5%, the Fed holds. Prime stays at 6.75%.

June 16–17, 2026: The first meeting where a cut is meaningfully priced in (~40% probability). If economic data softens, a 0.25% cut would bring prime to 6.50%.

Second half 2026: FOMC meetings on July 29–30, September 16–17, October 28–29, and December 16–17. Consensus forecast expects 1–2 cuts total in H2, potentially bringing prime to 6.25%–6.50% by year-end.

What this means for borrowers: If you are considering a variable-rate product (HELOC, SBA loan, business LOC), the direction of rates is favorable — prime is more likely to fall than rise in 2026. If you lock a fixed rate now, you may miss further savings. But if inflation resurges, the Fed could pause or even reverse course. Read our full analysis: Prime Rate Forecast 2026.

What Is the Current Federal Funds Rate?

The current federal funds rate target range is 3.50%–3.75%, set by the Federal Open Market Committee (FOMC) at its March 2026 meeting. The effective federal funds rate — the actual overnight rate banks charge each other — sits at approximately 3.58%, well within the target corridor. This is 1.75 percentage points lower than the cycle peak of 5.25%–5.50% that held from July 2023 through September 2024.

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 3.50%–3.75%, the prime rate formula yields 6.75% (upper bound of 3.75% + 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?

Interest rates have already come down significantly — the Fed has cut the federal funds rate five times since September 2024, bringing the target range from 5.25%–5.50% down to 3.50%–3.75%. The prime rate has fallen in lockstep from 8.50% to 6.75%. However, the pace of cuts has slowed and markets currently price an approximately 85% probability that the Fed will hold rates steady at the April 28–29, 2026 FOMC meeting.

Looking ahead, CME FedWatch futures suggest 1–2 additional quarter-point cuts are possible in the second half of 2026, which would bring the prime rate to 6.25%–6.50% by year-end. The key factors the Fed is watching are core PCE inflation (currently around 2.5%, 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?

A rate hike in 2026 is not the base case — but it is not impossible. As of April 2026, fed funds futures assign less than a 5% probability to any rate increase this year. The Fed’s own dot plot from its latest Summary of Economic Projections signals a bias toward further easing, not tightening. Most FOMC members project the federal funds rate ending 2026 between 3.00% and 3.75%.

The scenario that could trigger a rate hike would involve a significant re-acceleration of inflation — for example, core CPI climbing back above 4% due to tariff-driven supply shocks or an energy price spike. Even then, the Fed would likely pause cuts before reversing to hikes. Chair Powell has repeatedly stated the committee wants to see “sustained progress” toward 2% inflation before making any move in either direction.

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 five times in 2024 (September, October, November, December, and the carry-over from the December cut) and has held steady through Q1 2026. 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 6.75% as of April 2026, effective since December 11, 2025 when the Fed delivered its fifth rate cut of the easing cycle. The prime rate is calculated as the federal funds rate upper bound (currently 3.75%) 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 6.75%, prime is 1.75% lower than its recent peak of 8.50% in mid-2024, meaning borrowers with variable-rate products have already seen meaningful relief.

When did the prime rate last change?

The prime rate last changed on December 11, 2025, dropping from 7.00% to 6.75% after the Fed cut the federal funds rate by 25 basis points at its December FOMC meeting. This was the fifth cut in the current easing cycle that began with a 50-basis-point cut in September 2024, bringing the cumulative reduction to 1.75 percentage points. Before that, the previous change was October 31, 2025 (7.25% to 7.00%). 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 next FOMC meeting is April 28–29, 2026, but markets price in roughly an 85% probability of a hold, meaning the prime rate is likely to stay at 6.75% through at least May. The first realistic window for a cut is the June 16–17 meeting, where the CME FedWatch Tool currently shows about a 40% chance of action. If the Fed does cut by 25 basis points, prime would drop to 6.50% within one business day. The actual timing hinges on inflation data — core PCE needs to fall below 2.5% for the Fed to feel comfortable moving, and the March and April 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 6.75%. 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 6.75% with a typical 16% margin, your APR would be 22.75%. Since the Fed began cutting rates in September 2024, prime has dropped 1.75 percentage points from 8.50%, which translates to a $5,000 balance saving about $88 per year in interest charges. 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 3.50%–3.75%, the upper bound of 3.75% plus 3.00% gives you a prime rate of 6.75%. 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 3.50%–3.75%, set by the FOMC at its March 18–19, 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. The Fed has cut rates five times since September 2024, lowering the target from 5.25%–5.50% to its current level. The Federal Reserve H.15 release publishes the effective federal funds rate daily, which currently averages about 3.58%. The prime rate is always 3 percentage points above the upper bound, which is why prime sits at 6.75% today.

When will interest rates go down?

The FOMC’s March 2026 dot plot projects one more 25-basis-point cut this year, which would bring the fed funds rate to 3.25%–3.50% and the prime rate to 6.50%. Futures markets see June 2026 as the earliest likely meeting for a cut, with about a 40% probability, rising to roughly 60% for the September meeting. The actual timing depends on inflation: if core PCE drops below 2.5%, the Fed has room to act sooner, but if it stays above 2.7%, cuts could be delayed into late 2026 or beyond. 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