The Federal funds rate target remained at 3.75% to 4% after a 10–2 vote by the Federal Reserve’s policy committee on October 28, 2026. Two officials preferred a quarter-percentage-point increase.

Federal funds rate decision and dissents

The Federal Open Market Committee said it would maintain the target range in support of the Fed’s dual mandate and continue its policy of maintaining ample reserves in the banking system.

Lisa D. Cook and Beth M. Hammack voted against the decision, preferring to raise the target range by 0.25 percentage point at the meeting.

The rate guides overnight lending between depository institutions. Through its influence on that rate, the Fed can affect other interest rates and broader economic conditions.

Growth remains strong as inflation stays elevated

The committee described economic activity as expanding at a strong pace, with resilient domestic spending, strong productivity growth and robust capital investment. It said job gains had kept pace with the workforce and the unemployment rate had changed little.

Inflation remained elevated, while uncertainty was also high, partly because of geopolitical developments. The committee said additional information would help it determine the policy stance needed to return inflation to its 2% goal in a timely manner.

Update — 2026-10-28

In its October policy statement, the Federal Reserve described economic activity as “expanding at a strong pace,” compared with “solid” in September. The change in language appears to be a stronger characterization of activity than the one the Federal Open Market Committee used in its previous statement.

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