FOMC October 2026: Fed Holds as Two Push for Rise

The Federal Reserve held its target range for interest rates at 3.75% to 4% on 28 October. The vote was 10 to 2. Two officials dissented in favour of a rise.

The hold follows the 0.25-point rise at the September meeting, the first increase since July 2023. The statement said the economy is "expanding at a strong pace" but that inflation "remains elevated". The next decision is on 9 December, with new projections.

The target range is the band the Fed sets for the Fed Funds Rate, the rate banks charge each other for overnight loans. We explain its role in What Does the Fed Do?

The vote was 10 to 2. Lisa Cook and Beth Hammack voted against holding. They "preferred to raise the target range for the federal funds rate by 1/4 percentage point at this meeting". That would have taken the range to 4% to 4.25%.

At the previous meeting on 16 September, the committee voted 12 to 0 to raise the range by 0.25 points. That was the first rise since July 2023.

The implementation note set the interest rate on reserve balances at 3.90%. The primary credit rate stayed at 4%. The overnight reverse repurchase rate stayed at 3.75%.

The statement called economic activity "strong". It noted that "domestic spending has been resilient" and "productivity growth is strong". Capital investment was firm.

On jobs, the committee said gains "have kept pace with the workforce" while the Unemployment Rate "has changed little".

On inflation, the statement repeated that it "remains elevated". The committee said "the accumulation of more information" would guide the next step. It added: "The Committee will deliver price stability."

The balance sheet section was unchanged. The Fed said it was "continuing its policy of maintaining ample reserves in the banking system".

The chart shows the target range since 2019. The Fed cut it to 0% to 0.25% in March 2020. It then raised it to 5.25% to 5.5% by July 2023.

Cuts from September 2024 took it to 3.5% to 3.75% by June 2025. The September 2026 rise lifted it 0.25 points to 3.75% to 4%. The October meeting left it there.

The decision came out at 2:00 p.m. Eastern time on 28 October. These moves compare that day's close with the close on 27 October:

The 2-year yield, which is sensitive to near-term rate expectations, edged lower. The 10-year yield, which reflects longer-term growth and inflation views, moved higher. We explain the difference in What Is the Yield Curve?

The hold keeps the target range at the level set in September. Two dissenters wanted to go further. That split suggests the committee is not settled on whether rates are high enough.

The statement kept the phrase "inflation remains elevated". Until that language shifts, the door to further rises stays open.

The Fed's preferred inflation measure is the Personal Consumption Expenditures (PCE) Price Index. We explain the measure in What Is PCE Inflation?

The full FOMC meeting schedule is on our calendar page.

Lisa Cook and Beth Hammack wanted the target range to move to 4% to 4.25%. Their votes suggest they judged the current rate as insufficient given persistent inflation. Dissents are not unusual. They signal a range of views within the committee. The statement offers no detailed reasoning for the dissent. That typically appears in the minutes, due out in three weeks.

It is the rate banks charge each other for overnight loans of reserves. The Fed sets a target range for this rate. Changes in the range ripple through mortgage rates, savings rates and broader borrowing costs. We explain the mechanics in How the Fed Sets Rates.

The next meeting is on 8 and 9 December 2026. It will include a new Summary of Economic Projections (SEP), the officials' own forecasts for growth, inflation and the rate path. We explain these projections in What Are Fed Funds Futures?