Fed Holds Rates at 3.75 to 4.00 Percent in 10 to 2 Vote

Update: Warsh says the Fed will hold fewer rate votes in 2027 and 2028

Updated 19:14 UTC, Oct. 28, 2026. Federal Reserve Chair Kevin Warsh told his post meeting news conference on Wednesday that the Federal Open Market Committee will keep meeting eight times a year, but that one of its eight meetings in 2027 will be dedicated to broad monetary policy strategy, with no vote on the federal funds rate and no policy statement anticipated, Barron's reported. That leaves seven meetings with a rate decision in 2027. In 2028, two meetings will be dedicated to strategy discussions and six to setting policy, MarketWatch reported. Warsh said: "We believe eight meetings per year is the right number for the FOMC." USA Today, in its live coverage of the news conference, reported the same announcement. The strategy sessions will not include votes or news conferences afterward, and the Fed could still change rates through an emergency meeting if enough members believed a change was warranted, MarketWatch reported. Bloomberg reported that bond traders were pricing in roughly a 90 percent probability of a rate hike in December, PANews reported.

The Federal Reserve held its benchmark interest rate at 3.75 percent to 4.00 percent on Wednesday, October 28, 2026, ending its final meeting before the November 3 midterm elections with a decision that kept policy steady while two officials pushed for a tighter stance.

The Federal Open Market Committee voted 10 to 2 to leave the federal funds rate unchanged. Fed Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, preferring a quarter point hike. The split showed a committee that sees inflation as still too high, but not high enough this week to justify another increase.

A pause after a September hike

In September the Fed had raised the range by a quarter point, its first hike in three years. That move marked a turn after a long period in which officials focused on supporting growth and employment. Wednesday's hold gives the committee time to read more price and jobs data before its December meeting, where forecasters expect a quarter point increase.

What the statement said

In its statement, the committee said plainly: "Inflation remains elevated." It added: "The accumulation of more information will help the Committee determine the policy stance appropriate to ensure a timely return of inflation to the Committee's 2 percent goal." Those two lines set the tone for the decision. Price pressure has eased from earlier levels, but it has not returned to target, and officials said they need more evidence before deciding whether steady policy is enough or another hike is needed.

The statement described economic activity as expanding at a strong pace. It said domestic spending was resilient and productivity growth was strong. Job gains, it said, are keeping pace with the workforce, and unemployment was little changed. In other words, the economy the Fed described is not slowing sharply. Households are still spending, output per worker is rising, and the labor market remains balanced rather than weak.

The price numbers behind the decision

Consumer prices rose 3.7 percent in the year to September. Core consumer prices, which strip out food and energy, rose 2.6 percent over the same period. Producer prices climbed 6.3 percent, a reading that points to cost pressure earlier in the supply chain. Taken together, the figures explain both sides of the vote. The majority could point to core inflation closer to target and a stable job market. The dissenters could point to headline inflation and producer prices well above 2 percent.

Markets and what happens next

Chair Kevin Warsh was due to hold a news conference at 2:30 p.m. Eastern Time on October 28, where reporters were expected to press him on the December meeting and on how the committee weighs producer prices against core consumer prices. Right after the decision, the S&P 500 was up about 14 points. The two year Treasury yield rose 2.7 basis points to 4.75 percent, and West Texas Intermediate crude rose $2.94 to $102.82, according to live coverage from Investing.com, reported as InvestingLive. The moves were small but pointed in the same direction. Investors read the hold not as a promise to stay put, but as a pause before a likely December hike, with the November 3 midterms now the next fixed date on the calendar.