The Fed Funds Rate is generally considered the primary tool that the Federal Open Market Committee of the Federal Reserve uses to influence interest rates and the economy.  Changes in the Fed Funds Rate will have a significant effect on bank rates by influencing the borrowing cost of banks in the overnight lending market.  The cost of funds to banks in the overnight lending market will in turn impact interest rates that are close in term such as other short term and mid term interest rates.  If the Fed Funds Rate move up or down, other short term rates will move in the same direction and change the borrowing costs and loan profit margins of the bank.  The rate of return offered by banks on deposit products such as certificates of deposit, savings accounts, and money market accounts will change as the banks cost of funds change.  Changes in the Fed Funds Rate will then often lead to changes in the Prime Rate or other bank lending rates to their borrowers.  The Prime Rate in itself  influences rates for many credit cards, home equity loans, auto loans, and personal loans.

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