The Federal Reserve left US interest rates unchanged in a range between 3.75% and 4% at its meeting on Wednesday, October 28, 2026, matching market expectations.

The Fed leaves US rates unchanged at 3.75%-4%. All as expected, now over to Warsh

After the first rate hike since 2023, delivered on September 16, 2026, the US central bank led by Kevin Warsh opted for the status quo.

Watch the reaction across financial markets, in particular the euro-dollar exchange rate and the main US equity indexes, namely the Dow Jones, the Nasdaq and the S&P 500.

Today’s decision by the FOMC, the Federal Reserve’s monetary policy arm, had been widely priced in by markets, which expect another rate hike, after September’s, at the end of the year’s final meeting, scheduled for December 8 and 9.

But US inflation is not under control. And the Fed says so in its statement

US inflation has not come back under control, and the Fed said as much in the statement announcing its rate decision.

The consumer price index jumped in September to almost double the Fed’s 2% target, reaching 3.7% year on year.

The FOMC statement released after today’s meeting flagged the problem: “Inflation remains elevated”, it reads, and “additional information in totality will help the Committee determine the appropriate policy approach, in order to secure a timely return of inflation to the Committee’s 2 percent objective. The Committee will ensure price stability”.

The rate decision was not unanimous: two of the 12 FOMC members - Governor Lisa Cook and Cleveland Fed President Beth Hammack - voted in favor of a 25 basis point increase in the US fed funds rate.

The statement also says that “economic activity is expanding at a solid pace. Although uncertainty remains elevated, in part because of geopolitical developments, household spending continues to be resilient. Productivity growth is strong, and capital investment is robust. Job gains have kept pace with the expansion of the labor force, and the unemployment rate has changed little”.

The risk of a hike at the final meeting of the year is real. Today’s statement described the US economy as “strong”, a firmer word than the previous “solid”.

From rates to inflation to GDP: everything Warsh said. The announcement on 2027-2028 meetings

Explaining why he decided to leave rates unchanged, Fed Chair Kevin Warsh pointed to the strength of the US economy. Third-quarter US GDP “will probably show growth at a pace above 3%, on the back of solid consumer spending”, he said.

Warsh also cited “the historically high level of capital expenditure”, adding that “labor market conditions are positive”.

He said “the Committee believes that the arrival of further information will help determine what the appropriate (monetary) policy steps to be taken will be”.

The Fed chief said “credit conditions for some businesses and households have tightened”. But “I don’t intend to say and I can’t say that financial conditions are tight”.

“Inflation”, he added, “remains too high and, in recent weeks, energy prices have risen again”.

Warsh also recalled that “the Fed’s job is to make sure inflation does not become entrenched”, stressing that “we have shown we are ready to act”.

He closed with a change to the central bank’s calendar: in 2027 “there will be 8 Fed meetings, but at one of them there will be no vote”, while “in 2028 there will again be 8 FOMC meetings, but at two of them there will be no vote” on rates.

The changes will allow the Fed to focus on longer-term decisions, Warsh said.

Editor’s note

This article was originally published in Italian on money.it by Laura Naka Antonelli on October 28, 2026 as «Tassi Fed invariati al 3,75%-4%, Warsh spiega il motivo della pausa. E annuncia novità riunioni 2027-2028». It has been translated and adapted for an international audience by the Money.it International desk.