What did the Fed do in October 2026, and what did Warsh say?

The Federal Reserve held interest rates steady on October 28, 2026, in a 10 to 2 vote. Two officials wanted a hike, Chair Kevin Warsh would not say what December brings, and markets now price a December increase as likely. Here is what the Fed decided, what Warsh said, and what it changes for a long-term investor.

What did the Fed decide on October 28, 2026?

The Federal Open Market Committee kept the federal funds target range at 3.75% to 4.00%, according to the Fed's October 28 statement. It had raised the range a quarter point on September 16 in a 12 to 0 vote, its first increase since July 2023. This time the vote was 10 to 2. The statement said "Economic activity is expanding at a strong pace" and "Inflation remains elevated." It described domestic spending as resilient, productivity growth as strong, capital investment as robust, and job gains as keeping pace with the workforce, with the unemployment rate changing little. It closed that section with "The Committee will deliver price stability." The meeting carried no new economic projections, which arrive with the December meeting, according to the Fed's calendar. For how the odds moved before the decision, see will the Fed raise interest rates in October 2026.

Why did two Fed officials vote to raise rates?

Governor Lisa Cook and Cleveland Fed President Beth Hammack each voted to raise the target range by a quarter percentage point, according to the Fed's statement. The statement does not give their reasons. The data they were looking at is public: the Bureau of Labor Statistics reported September inflation at 3.7%, up from 3.4% in August, and the Fed's own statement calls inflation elevated. Hammack said before the pre-meeting blackout that inflation is too high and rates may need to rise, according to investinglive. A two-vote minority is small, but dissents have preceded moves before. Three officials voted for a hike in July, and the committee raised rates unanimously in September. See why the Fed raised rates instead of cutting them.

What did Warsh say at the press conference?

Warsh said inflation is "too high" and that "Americans, of course, are still dealing with inflation that has been running above the committee's objective for close to six years," according to CBS News. He added: "It's our responsibility to get inflation down." Asked about December, he said: "A lot of things can happen, so I'm not going to be able to share with you my musings about what happens..." He described the debate as "a heck of a family fight, a serious, sober discussion." According to Fox Business, he also said there is "no soft inflation target and no implicit inflation target" and that "politics played no role in the decision." President Trump has publicly criticized the Fed's September hike, ABC News reported, and the meeting came ahead of the midterm elections.

Will the Fed raise interest rates in December 2026?

Markets say probably. CME's FedWatch tool put the odds of a quarter-point hike at the December 8 to 9 meeting at 82.6% in Fox Business reporting and 86.0% in Finimize, up from 78.3% a day earlier. The two figures differ because they were taken at different times on October 28. Warsh's refusal to signal means the odds rest on data, and two scheduled releases come first:

1. October 29: September PCE inflation and the first estimate of third-quarter GDP, per the Bureau of Economic Analysis calendar. See why the Fed uses PCE and not CPI.
2. November 6: the October jobs report from the BLS, following a September gain of only 29,000.

The December meeting also brings a new dot plot. See what the Fed dot plot is. Odds move fast: hike odds for October 28 went from 73.5% on September 24 to 7.2% on October 22.

How did Treasury yields react to the Fed's decision?

The 10-year Treasury yield closed at 5.05% on October 28, up from 4.99% on October 27 and 4.96% on October 22, according to the Treasury Department's daily par yield curve. The 2-year closed at 4.67% and the 30-year at 5.37%. A six basis point rise in a day is small next to the 17 basis point drop on October 22, when the 10-year fell from 5.13% to 4.96%. The yield remains below its October 7 high of about 5.36%. Mortgage rates and bond fund prices follow the 10-year more closely than the federal funds rate, so December hike odds and the 10-year are the two numbers to watch together. See what a 5% 10-year Treasury yield means for your money.

What is changing about Fed meetings in 2027?

Warsh announced that starting in 2027, one of the Fed's eight meetings each year will focus exclusively on monetary policy strategy, with no rate vote and no policy statement, according to Fox Business. ABC News reported that this leaves seven rate decisions in 2027, down from eight this year. Warsh said the committee should "reserve time and space as an intellectually diverse group for strategic deliberations," per CBS. The Fed's calendar page lists eight tentative 2027 meetings, from January 26 to 27 through December 7 to 8, and does not yet mark one as strategy-only. It also notes that each date is tentative until confirmed at the preceding meeting. For an investor, the change means one fewer scheduled decision date per year. It does not change where rates stand today.

The honest counterargument: should the Fed have raised rates instead?

The case for a hike is strong. Inflation is 3.7%, the Fed's statement calls it elevated and the economy strong, the 10-year yield sits above 5%, and Warsh himself said inflation has run above the objective for close to six years. Two voting members agreed. The case for the hold is also real. September payrolls rose only 29,000, core CPI was 2.6% over twelve months per the BLS, and governor Christopher Waller has said hikes need not come at consecutive meetings. A rate increase also takes months to slow prices, so waiting for PCE, GDP, and the November jobs report costs little if the data support a December move.

The fair resolution: the committee disagrees about timing, and the market expects the next quarter-point increase in December. A long-term plan can be built without knowing which side is right.

What a beginner should actually do

1. Keep contributions on schedule. The Fed held, and markets then priced a hike six weeks out. See time in the market beats timing the market.
2. Check where your cash sits. At a 3.75% to 4.00% policy rate, idle cash in a near-zero account has a cost. See where to keep cash when rates are high.
3. Know your variable-rate debt. Credit cards and HELOCs reprice within a billing cycle or two of a hike, and a December increase is the market's base case.
4. Understand bond price risk before adding bonds. A hot report can push yields up and bond fund prices down. See should beginners buy bonds now.
5. Read the next data releases as data. PCE, GDP, and the jobs report can each move December odds for a few days.

The quick version

• The Fed held its rate at 3.75% to 4.00% on October 28, 2026, after raising it a quarter point in September
• The vote was 10 to 2: Lisa Cook and Beth Hammack voted for a quarter-point hike
• The statement said economic activity is expanding at a strong pace and inflation remains elevated
• Warsh said inflation is "too high" and would not say whether the Fed will hike in December
• CME FedWatch priced a December 8 to 9 hike at 82.6% to 86.0%, up from 78.3% a day earlier
• The 10-year Treasury yield closed at 5.05% on October 28, up from 4.99% the day before
• From 2027, one of eight meetings each year is expected to focus on strategy, with no rate vote

A hold answers one meeting. It leaves the December question open, and a plan built before the decision does not need the answer.