Previous Campaigns by the Federal Reserve
to Raise Interest Rates
by Ron Griess
Proprietor, The Chart Store
www.thechartstore.com 
February 14, 2006

Originally published on February 8, 2006 as a Special Edition of
The Chart Store Weekly Blog

We have assembled 16 charts showing four prior periods when the Federal Reserve has had a campaign of raising interest rates.  Each period starts with a chart of the Target Rate and maturities of 3 months, 6 months and 1 year;  the second chart shows the Target Rate and maturities of 2 years, 3 years and 5 years; the third chart shows the Target Rate and maturities of 7 years, 10 years and either the 20 year or 30 year; and the fourth chart shows the Target Rate and all the maturities.  Each chart also includes a brief statistical summary.

CHART 1: 1988

CHART 2: 1988

CHART 3: 1988

CHART 4: 1988

CHART 5: 1994

CHART 6: 1994

CHART 7: 1994

CHART 8: 1994

CHART 9: 1999

CHART 10: 1999

CHART 11: 1999

CHART 12: 1999

CHART 13: 2004

CHART 14: 2004

CHART 15: 2004

CHART 16: 2004

SOME GENERAL OBSERVATIONS:

• The impact of Fed actions shows up most noticeably in the shortest maturities. 
• The Fed also seems to follow the market as witnessed by the shortest maturities peaking and starting down after the last increase and before the first decrease (Charts 1, 5 and 9).
• Longer maturities generally rise less than shorter maturities and are near or below their respective levels from the start of the campaign (Charts 3, 7 and 11).
• During the current cycle, neither the 10 year nor the 20 year have been above their level from the start of the campaign.

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