In brief
On October 28, the Federal Open Market Committee (FOMC) left the target federal funds rate unchanged at 3.75%–4.00%. The decision, voted 10–2, followed a recent 0.25% hike and was made amid concerns that inflation remains too high. Fed Chair Kevin Warsh warned that another increase could come later this year as the committee monitors detailed economic data.
The U.S. Federal Reserve on Wednesday, October 28, kept its benchmark interest rate unchanged at 3.75–4.00 percent, a decision arrived less than a week before the 2026 midterm elections. The move came after a recent 0.25 percent hike and as the committee reviews the economy’s trajectory.
The Federal Open Market Committee (FOMC) stated that “Economic activity is expanding at a strong pace. While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient. Productivity growth is strong, and capital investment is robust. Job gains have kept pace with the workforce, and the unemployment rate has changed little.”
“Economic activity is expanding at a strong pace…productivity growth is strong…job gains have kept pace with the workforce.”
The FOMC added that “inflation remains elevated” and reaffirmed its dual mandate of price stability and ample reserves in the banking system.
Fed Chair Kevin Warsh said at a press briefing that inflation “remains too high.” He added that energy and related prices have moved higher again in recent weeks, and that the committee’s goal is to ensure that “relative price changes in some sectors do not broaden out across the economy.”
“Inflation remains too high. It is our responsibility to get inflation down.”
In a 10‑2 vote of the 12‑member FOMC, 10 members chose to keep the rate unchanged and two—two were in favor of a hike.
The decision followed the Fed’s first raise since July 2023 and was aligned with market expectations that a pause would precede another quarter‑point hike in December. The Fed also announced that it would hold rate‑setting votes at seven out of eight meetings next year.
