5-Year Treasury Constant Maturity Minus Federal Funds Rate
Monthly
T5YFFM • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
-0.38
Year-over-Year Change
-67.52%
Date Range
7/1/1954 - 7/1/2025
Summary
The T5YFFM represents the monthly five-year, five-year forward inflation expectation rate tracked by the U.S. Federal Reserve. This metric provides critical insight into long-term market expectations about future inflation trends.
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 measures the average inflation rate market participants anticipate over a five-year period, starting five years from now. Economists and policymakers use this forward-looking metric to understand market sentiment and potential inflationary pressures.
Methodology
The rate is calculated using Treasury Inflation-Protected Securities (TIPS) and nominal Treasury yields to derive market-implied inflation expectations.
Historical Context
Central banks and financial institutions use this trend to inform monetary policy decisions and assess long-term economic stability.
Key Facts
- Represents market-based inflation expectations
- Calculated using Treasury securities
- Important indicator for monetary policy planning
FAQs
Q: What does the T5YFFM measure?
A: It measures the market's expected average inflation rate five to ten years in the future, derived from financial market instruments.
Q: Why is this inflation expectation rate important?
A: It provides insight into long-term economic expectations and helps policymakers understand potential future inflationary pressures.
Q: How is the T5YFFM calculated?
A: The rate is calculated by comparing yields of Treasury Inflation-Protected Securities (TIPS) with nominal Treasury yields.
Q: How do economists use this data?
A: Economists and central bankers use this metric to gauge market sentiment and inform monetary policy decisions.
Q: How often is this data updated?
A: The T5YFFM is typically updated monthly, providing a current snapshot of long-term inflation expectations.
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Citation
U.S. Federal Reserve, Monthly [T5YFFM], retrieved from FRED.
Last Checked: 8/1/2025