In brief
In a 10‑2 split, the Federal Open Market Committee kept rates at 3.75‑4.00 percent, less than a week before the 2026 midterm elections. Fed Chair Kevin Warsh warned that inflation remains too high and hinted that further hikes could come later in the year. The decision helped lift U.S. stocks and gave a brief pause to rate‑setting momentum.
The U.S. Federal Reserve on Wednesday, Oct. 28, held its benchmark interest rate steady at a 3.75‑4.00 percent range, a decision made by a 10‑2 vote among its 12 members, days before the November 3 midterm election.
The Fed’s statement said economic activity remains strong, with resilient domestic spending, robust capital investment, and solid productivity, but inflation is still elevated and close to the 2 percent target.
Fed Chair Kevin Warsh told a press briefing:
"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."Warsh added that inflation “remains too high” and that the Fed may pursue additional rate increases later this year, citing energy‑price gains. The Fed also announced it will change the schedule of FOMC meetings in the coming years, keeping eight sessions per year, with one dedicated to broad monetary policy in 2027.
In the markets, the Dow rose 0.19 percent, the S&P 500 gained 0.28 percent, and the Nasdaq increased 0.27 percent in the U.S.; the Korea Composite Stock Index edged up 0.17 percent on the pause, as investors weighed the Fed’s outlook and Samsung Electronics’ anticipated earnings.
While the Fed’s decision is a policy pause, analysts note it sets the stage for a possible rate hike by year‑end, as financial conditions tighten and inflation data further shape the Committee’s stance.
