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Rates & Fed · October 28, 2026 · 2 min read

Fed holds target at 3.75%-4%; two voters prefer a quarter-point increase

By Econ Data Tools Editorial Team

Published October 28, 2026 • Updated October 28, 2026

The October 28 FOMC statement records a 10-2 vote to hold the federal funds target range. Cook and Hammack preferred a quarter-point increase, not a cut.

The Federal Open Market Committee maintained the target range for the federal funds rate at 3.75% to 4% on October 28. Its statement records a 10-2 vote. This was a hold, not an announced rate cut or increase. Lisa D. Cook and Beth M. Hammack voted against the policy action because they preferred a quarter-percentage-point increase at this meeting. Their dissent should not be described as support for a cut. The majority decision and the dissenters' preferred action are different facts. The statement describes economic activity as expanding at a strong pace, domestic spending as resilient and productivity growth as strong. It says job gains have kept pace with the workforce and the unemployment rate has changed little. These are the committee's assessments, not new statistical estimates produced by this brief. The committee says inflation remains elevated and that additional information will help determine the appropriate policy stance for returning inflation to its 2% goal. The statement does not promise a particular decision at the next meeting or establish that inflation has already reached that goal. The accompanying implementation note maintains interest on reserve balances at 3.90%, effective October 29. It directs operations to keep the federal funds rate within the 3.75%-4% target range and describes purchases and reinvestment arrangements to maintain ample reserves. That is not the same as a guarantee of a fixed monthly balance-sheet runoff. The federal funds target range is not a consumer mortgage quote, a bank's savings rate or every Treasury yield. The decision alone does not prove why a particular market yield changed or that households will immediately receive cheaper credit. Observation dates, market pricing and individual lending terms need separate evidence.

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