Optencis
The US Federal Reserve (Fed) kept its target range for the federal funds rate at 3.75% to 4.00% on 28 October 2026, in line with forecasts. The decision passed by 10 votes to 2, and both dissenters wanted to raise rates rather than hold them.
The decision and the vote
The Federal Open Market Committee (FOMC), the Fed body that sets interest rates, announced its decision at 18:00 UTC. The federal funds rate, the overnight rate banks charge each other, stays in a range of 3.75% to 4.00%. Governor Lisa D. Cook and Cleveland Fed President Beth M. Hammack voted against, preferring a quarter-point increase at this meeting. The Fed also said it will keep plenty of reserves in the banking system.
What the statement said
The Fed painted a picture of a solidly growing economy. Spending inside the US has held up well, worker output per hour is rising quickly and business investment is firm, even though the outlook is still clouded, partly by geopolitical events. Hiring has roughly matched growth in the labour force, and the jobless rate has been broadly stable. On prices, the committee said inflation is still above its 2% goal and stressed its commitment to bringing it back there in a timely way, adding that more data will guide its next steps.
How it compares with expectations
The economic calendar showed a forecast of 4.00% for the upper end of the range, the same as the previous level, so the hold itself was expected. What stands out is the split vote: two officials pushing for higher rates is a sign that part of the committee is worried about inflation. Bloomberg reported that former Fed Vice Chairman Richard Clarida sees a rate rise at the December meeting, with another possible in March. That is one forecaster's view, not a Fed decision.
He anticipates an increase at the December meeting, with a further move on the table for March.
Views reported by the sources, not Optencis opinions.
What comes next
The statement gave no fixed path for rates and tied future moves to incoming information, especially on inflation. Traders will follow upcoming price data and speeches by Fed officials, including the two dissenters, ahead of the December meeting. For USD pairs, gold and US stock indices, any shift in how many officials favour tighter policy can bring sharp moves, so we recommend caution around these events.
Sources: Federal Reserve, Bloomberg.
