Overnight Bank Funding Rate: 1st Percentile
OBFR1 • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
4.25
Year-over-Year Change
-0.70%
Date Range
10/12/2021 - 8/8/2025
Summary
The Overnight Bank Funding Rate (1st Percentile) represents the lowest range of short-term borrowing costs between financial institutions. This metric provides critical insight into the most competitive and lowest-cost overnight lending rates in the banking system.
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
This economic indicator tracks the lowest percentile of overnight funding rates across major banks and financial institutions. Economists use this data point to understand the minimum cost of interbank lending and assess liquidity conditions in the financial markets.
Methodology
The rate is calculated by the Federal Reserve based on actual transactions and reported funding costs from a representative sample of banks and financial institutions.
Historical Context
Policymakers and central bank analysts use this metric to monitor banking system liquidity, assess financial market stress, and inform monetary policy decisions.
Key Facts
- Represents the lowest range of overnight lending rates
- Calculated using actual bank transaction data
- Provides insight into banking system liquidity conditions
FAQs
Q: What does the 1st percentile mean in this context?
A: The 1st percentile represents the lowest 1% of overnight funding rates across reporting banks, indicating the most competitive borrowing costs.
Q: How often is this rate updated?
A: The Overnight Bank Funding Rate is typically updated daily by the Federal Reserve, reflecting real-time changes in interbank lending markets.
Q: Why is this rate important for economists?
A: This rate helps economists understand short-term liquidity conditions and potential stress in the banking system, which can signal broader economic trends.
Q: How does this differ from other overnight lending rates?
A: Unlike other rates that might represent averages, the 1st percentile specifically captures the lowest-cost lending transactions in the market.
Q: Can individual investors use this information?
A: While primarily used by financial professionals, this rate can provide insights into overall banking system health and potential economic conditions.
Related Trends
Longer Run FOMC Summary of Economic Projections for the Fed Funds Rate, Central Tendency, High
FEDTARCTHLR
Secured Overnight Financing Volume
SOFRVOL
Interest Rate on Reserve Balances (IORB Rate)
IORB
Discount Window Primary Credit Rate
DPCREDIT
FOMC Summary of Economic Projections for the Fed Funds Rate, Central Tendency, Midpoint
FEDTARCTM
Effective Federal Funds Rate: 1st Percentile
EFFR1
Citation
U.S. Federal Reserve, Overnight Bank Funding Rate: 1st Percentile [OBFR1], retrieved from FRED.
Last Checked: 8/1/2025