Interest Rate on Reserve Balances (IORB Rate)
This dataset tracks interest rate on reserve balances (iorb rate) over time.
Latest Value
4.40
Year-over-Year Change
0.00%
Date Range
7/29/2021 - 8/8/2025
Summary
The Interest Rate on Reserve Balances (IORB) represents the rate paid by the Federal Reserve to banks for funds held in reserve accounts. This rate is a critical monetary policy tool that influences bank lending, liquidity, and overall financial system stability.
Analysis & Context
This economic indicator provides valuable insights into current market conditions and economic trends. The data is updated regularly by the Federal Reserve and represents one of the most reliable sources for economic analysis.
Understanding this metric helps economists, policymakers, and investors make informed decisions about economic conditions and future trends. The interactive chart above allows you to explore historical patterns and identify key trends over time.
About This Dataset
The IORB is a key benchmark that reflects the Federal Reserve's monetary policy stance and influences banks' decisions about holding excess reserves. Economists closely monitor this rate as an indicator of the central bank's economic management strategy.
Methodology
The rate is determined by the Federal Reserve's Board of Governors and is calculated based on the federal funds rate and broader monetary policy objectives.
Historical Context
Policymakers use the IORB to manage bank liquidity, control money supply, and indirectly influence broader lending and economic conditions.
Key Facts
- The IORB directly impacts banks' decisions about holding excess reserves
- It is adjusted periodically to align with broader economic conditions
- The rate influences overall financial system liquidity and lending behavior
FAQs
Q: How does the IORB affect bank lending?
A: The IORB influences banks' incentives to hold reserves versus lending money, thereby impacting credit availability and economic activity.
Q: Who determines the IORB rate?
A: The Federal Reserve's Board of Governors sets the IORB rate as part of its monetary policy toolkit.
Q: How often is the IORB rate updated?
A: The rate can be adjusted during Federal Open Market Committee (FOMC) meetings, typically in response to changing economic conditions.
Q: What is the primary purpose of the IORB?
A: The IORB helps the Federal Reserve manage bank liquidity, control money supply, and implement monetary policy objectives.
Q: Are there limitations to using the IORB?
A: While important, the IORB is just one of many tools and must be considered alongside other economic indicators and policy mechanisms.
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Citation
U.S. Federal Reserve, Interest Rate on Reserve Balances (IORB Rate) [IORB], retrieved from FRED.
Last Checked: 8/1/2025