WASHINGTON | Fed Holds Interest Rates Steady After September Hike; Two Officials Wanted Another Increase

Author: FFP Ai Bot

WASHINGTON- The Federal Reserve left its benchmark interest rate unchanged Wednesday, keeping the federal funds target range at 3.75% to 4%, one month after it approved its first rate increase since 2023.

The decision was not unanimous. The Federal Open Market Committee voted 10-2 to hold. Fed Governor Lisa D. Cook and Cleveland Fed President Beth M. Hammack voted against it, saying they preferred to raise the target range by another quarter of a percentage point at this meeting, according to the Fed's statement. It was Cook's first dissent since joining the Fed in 2022, Benzinga reported.

What the Fed said

In its statement, the committee said economic activity “is expanding at a strong pace,” that “domestic spending has been resilient” and that “job gains have kept pace with the workforce, and the unemployment rate has changed little.” Reuters noted the Fed upgraded its description of the economy to “strong” from “solid” in September.

On prices, the message was blunt: “Inflation remains elevated.” The Fed said “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,” adding, “The Committee will deliver price stability.”

Warsh: no promise on December

At his afternoon news conference, Fed Chairman Kevin Warsh declined to say whether the Fed will raise rates at its next meeting, Dec. 8-9. “I don't believe in forward guidance absent exigent circumstances,” Warsh said, according to Benzinga and CNBC. “I also don't believe in pre-judging meetings.”

Warsh said borrowing conditions have already started to tighten since the September increase. “Since our policy action in September, we have started to see some changes in financial and credit conditions. They have tightened for some businesses and households, much as we would expect,” he said, according to the Fed's transcript of his opening statement. He added that while overall financial conditions are tighter, “I'm unwilling and unable to call them tight.”

Warsh also announced a change to the Fed's meeting schedule. The Fed will keep eight meetings a year, but in 2027 one of them “will focus exclusively on broad monetary policy strategy, with neither a vote on the federal funds rate nor a policy statement anticipated,” he said. He said he expects two strategy-only meetings in 2028.

Wall Street and bond markets

Stocks finished slightly higher. The S&P 500 rose 0.28% to close at 7,743.98, the Dow Jones Industrial Average gained 97.53 points, or 0.19%, to 52,475.10, and the Nasdaq composite added 0.27% to 26,549.85, CNBC and MarketWatch reported. It was the third straight winning day for all three indexes.

Longer-term borrowing costs moved up. The yield on the 10-year Treasury note, which helps set mortgage rates, rose about 0.05 percentage point to 5.044%, its biggest gain since Sept. 28, while the 2-year yield slipped to 4.731%, according to MarketWatch.

Traders still expect a December increase. After Warsh spoke, the CME Group's FedWatch tool showed about an 83.5% probability of a rate hike in December, down slightly from about 86% before the meeting, TradingKey reported. Those are market bets, not guarantees, and they can shift with new data. The government's third-quarter GDP report and the September PCE inflation report are due Thursday morning.

What it means for readers

Because the Fed did not raise rates Wednesday, borrowing costs are not expected to jump right away, but they are not expected to fall soon either. “As long as the Federal Reserve keeps rates at the current target range of 3.75% to 4%, consumers are unlikely to see much relief,” CNBC reported.

• Mortgages: The average 30-year fixed mortgage was 7.33% before the decision, up from 7.12% a month earlier, according to Mortgage News Daily as reported by CNBC. Mortgage rates follow the 10-year Treasury yield, which rose Wednesday.
• Home equity loans: The average home equity loan rate was 8.77%, up from 8.28% in September, according to Bankrate.
• Credit cards: Most cards carry variable rates. “Credit card rates have risen for three straight months and are now at their highest levels since December 2025,” said Matt Schulz, LendingTree's chief consumer finance analyst, who told CNBC rates are likely to rise further as card issuers pass along the September hike.
• Car loans: Auto loan rates have stayed near 7%, with higher rates common for used cars, CNBC reported.
• Savings: Gains are small. The average money market account yields 0.45%, and a five-year CD averages 1.83%, according to Haver as reported by CNBC. High-yield savings accounts continue to pay more than traditional bank accounts.

For homeowners, car shoppers, farmers and anyone carrying credit card debt in Fostoria, Seneca County and across Northwest Ohio, the bottom line is the same: borrowing is likely to stay expensive while the Fed weighs another increase in December. Paying down high-interest debt and shopping around for loan and savings rates can help.

What happens next

The Fed's next rate decision is scheduled for Dec. 9, at the end of its Dec. 8-9 meeting, according to the Federal Reserve's FOMC calendar. The Fostoria Free Press will report the decision when it is announced.

This article is for general information only and is not financial advice.

Sources:
Federal Reserve FOMC statement, Oct. 28, 2026: https://www.federalreserve.gov/newsevents/pressreleases/monetary20261028a.htm
Transcript of Chairman Warsh's press conference opening statement, Oct. 28, 2026: https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20261028.pdf
Federal Reserve FOMC meeting calendar: https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm
CNBC, Oct. 28, 2026: https://www.cnbc.com/2026/10/28/fed-interest-rate-decision-october-2026.html
CNBC, Oct. 28, 2026: https://www.cnbc.com/2026/10/28/fed-rate-decision-consumer-borrowing-costs.html
CNBC live updates, Oct. 28, 2026: https://www.cnbc.com/2026/10/28/fed-meeting-today-live-updates.html
CNBC market close, Oct. 28, 2026: https://www.cnbc.com/2026/10/27/stock-market-today-live-updates.html
MarketWatch, Oct. 28, 2026: https://www.marketwatch.com/story/u-s-stocks-up-treasury-yields-mixed-after-fed-hold-dbd6e218
Reuters via Investing.com, Oct. 28, 2026: https://www.investing.com/news/economy-news/fomc-holds-rates-steady-markets-mostly-follow-suit-4980441
Benzinga, Oct. 28, 2026: https://www.benzinga.com/markets/macro-economic-events/26/10/62672193/warsh-december-hike-bond-market-tightening-credit-spreads
TradingKey (CME FedWatch data), Oct. 28, 2026: https://www.tradingkey.com/analysis/economic/central-banks/262247759-fed-kevin-warsh-forward-guidance-december-hike-83-percent-tradingkey