Long Term Perspective
The yield on the 3-month Treasury bill is typically lower than the federal funds rate. In the 1980s, the 3- month bill averaged 49 basis points less than the funds rate, but in the 1990s this average fell to 18 basis points.

Short Term Perspective
The spread between the 3-month Treasury bill and the federal funds rate averaged -34 basis points in 2000-01. This means that the 3-month bill yield was typically 34 basis points lower than the federal funds rate. From December 2001 through November 2002, the two rates appear identical, but the 3-month bill yield is actually less than the fed funds rate target.