Calendar › FOMC rate decision › 2026-10-28

Fed Holds at 3.75%-4.00% on a 10-2 Vote — Cook and Hammack Dissent for a Hike

Fundamentals · 2026-10-28

The FOMC held the target range at 3.75%-4.00% (vs hold expected, priced at 91-96% this morning) on a 10-2 vote: Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented in favour of a 25bp hike. The statement upgraded growth to "expanding at a strong pace" from "solid", kept "inflation remains elevated", and replaced September's "today's policy action will support a timelier return" with "the accumulation of more information will help the Committee determine the policy stance appropriate". It still ends "The Committee will deliver price stability." Every operating rate unchanged: IORB 3.90%, primary credit 4.00%, standing repo 4.0%, reverse repo 3.75%; bill purchases for reserve management continue. No projections at this meeting; the next set comes 8-9 December.

What It Changes

• The hold was priced; the dissents were not the base case. Two of twelve voters wanted a hike today, five weeks after the Committee raised unanimously. The hawkish wing did not shrink after September; it is now voting against the Chair.
• The statement went from acting to watching. September's policy sentence described what the hike would do. Today's says more information will decide "the policy stance appropriate", which is neither a promise of December nor a signal of a pause. It keeps the next move a live, data-dependent hike.
• The growth upgrade argues the hawks' case. "Strong" replaces "solid" in the first line on activity, and nothing else in the economic paragraph changed. A Committee that says growth is stronger and inflation still elevated, and holds anyway, is waiting for a reason, not looking for one to stop.
• Markets read it as a non-event in the statement window. In the 30 minutes to the press conference, ES was −0.04%, NQ −0.02% and gold −0.11%, with the 10-year yield about +1bp. The press conference at 14:30 carries the risk, and this brief does not cover it.

Impact

• USD — Slight bullish — two hike dissents and a growth upgrade lean hawkish against a hold the market had fully priced; the dollar index moved only +0.04% from 13:59 to 14:29.
• The front end barely moved: 2-year Treasury futures were about −0.01% in the window, a yield change of well under 1bp.
• The 10-year yield rose about 2bp by 14:15 and gave half of it back by 14:29; Tuesday's close was 4.99% (US Treasury).
• US Indices (ES / NQ / YM / RTY) — Neutral — a priced hold with no new guidance changes nothing for the index path on its own.
• In the window: ES −0.04%, NQ −0.02%, YM −0.14%, RTY −0.24%, all measured from 13:59 to 14:29. The low came at about 14:15, when NQ was −0.23% and RTY −0.32%, before a recovery into the press conference.
• RTY was weakest, as it usually is when a dissent for higher rates lands; small caps carry the most floating-rate debt.
• NQ's day still rests on Microsoft and Alphabet after the close, not on this statement.
• Gold (GC) — Slight bearish — gold was −0.25% at 14:15 and −0.11% at 14:29 against 13:59, extending a day that was already −0.5% before the release. Two hike dissents keep December alive, which is the scenario gold has been trading against.

Inside The Number

The Committee maintained the target range for the federal funds rate at 3.75%-4.00%, the level it raised to on 16 September. The vote was 10-2. Governor Lisa D. Cook and Cleveland Fed President Beth M. Hammack voted against, preferring to raise the target range by 1/4 percentage point. A hold was the near-certain outcome coming in: this morning's Open put the odds at 91-96% across Kalshi and CME FedWatch.

Read the vote across three meetings. In July the Committee held 9-3, with three members dissenting for a hike. In September it hiked 12-0. Today it held with two members dissenting for a hike again. No member has dissented toward easing at any of the three. The internal argument is about how many more hikes, not whether to reverse, and that will not change until the dissent pattern does.

The statement changed in two places, and both matter. The first is the opening line on activity: "Economic activity is expanding at a strong pace", against "solid" in September. The rest of that paragraph is identical, word for word: uncertainty "elevated owing, in part, to geopolitical developments", domestic spending "resilient", productivity "strong", capital investment "robust", job gains keeping pace with the workforce, and unemployment "changed little".

The second is the policy sentence. September read: "Today's policy action will support a timelier return to the Committee's 2 percent goal." Today reads: "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." That sentence does three things. It explains the hold (they want more data). It keeps a further move open (the "policy stance appropriate" is undetermined, not settled). And it keeps the goal in the same words as September: a "timely" return, not an eventual one.

What did not change is as telling. "Inflation remains elevated" stays. "The Committee will deliver price stability" stays as the closing line. There is still no forward guidance, no reaction function and no list of what the Committee is watching. This is the format Chair Warsh introduced after retiring routine guidance at Jackson Hole in August, and today's statement is the first hold written in it.

The operating settings are all unchanged. The Board kept interest on reserve balances at 3.90% and the primary credit rate at 4.00%, both by unanimous vote. The Desk continues standing overnight repo at 4.0% and reverse repo at 3.75%, capped at $160 billion per counterparty per day. It is still directed to buy Treasury bills, and if needed other Treasuries of three years or less, "when appropriate" to keep reserves ample, and to reinvest agency principal into bills. That is reserve management, not easing, and it is the same instruction as September.

What this brief does not contain. Chair Warsh's press conference began at 14:30, half an hour after the release. Nothing here reflects it. With a statement this short, the press conference is where the reasoning behind the hold, the two dissents and the December question gets argued; it gets its own brief.

The Internals

The decision and the operating settings:

Measure · Today · September · Effective

Target range, federal funds rate · 3.75%-4.00% · 3.75%-4.00% · Unchanged

Vote · 10-2, two dissents for a hike · 12-0 to hike · n/a

Interest on reserve balances · 3.90% · 3.90% · 29 October 2026

Primary credit rate · 4.00% · 4.00% · Unchanged

Standing overnight repo rate · 4.0% · 4.0% · 29 October 2026

Overnight reverse repo rate · 3.75% · 3.75% · 29 October 2026

Reverse repo per-counterparty cap · $160 billion per day · $160 billion per day · 29 October 2026

Treasury bill purchases for reserves · When appropriate · When appropriate · Unchanged

The statement, line by line against September:

Element · September 16 · October 28 · Read

Activity · expanding at a solid pace · expanding at a strong pace · Upgrade

Uncertainty · elevated, in part geopolitical · elevated, in part geopolitical · Unchanged

Domestic spending · resilient · resilient · Unchanged

Productivity and investment · strong, robust · strong, robust · Unchanged

Labour market · job gains kept pace, unemployment changed little · job gains kept pace, unemployment changed little · Unchanged

Inflation · remains elevated · remains elevated · Unchanged

Policy sentence · today's action will support a timelier return to 2% · more information will help determine the policy stance appropriate · From acting to watching

Closing line · The Committee will deliver price stability · The Committee will deliver price stability · Unchanged

The vote over the last three meetings:

Meeting · Decision · Vote · Dissents

28-29 July · Hold at 3.50%-3.75% · 9-3 · Three, all for a 25bp hike

15-16 September · Hike to 3.75%-4.00% · 12-0 · None

27-28 October · Hold at 3.75%-4.00% · 10-2 · Cook and Hammack, both for a 25bp hike

The statement window, 13:59 to 14:29 ET, before the press conference:

Instrument · 13:59 to 14:15 · 13:59 to 14:29 · Day at 14:29, vs Tuesday's settle

ES · −0.15% · −0.04% · +0.14%

NQ · −0.23% · −0.02% · +0.16%

YM · −0.17% · −0.14% · +0.11%

RTY · −0.32% · −0.24% · −0.14%

Gold · −0.25% · −0.11% · −0.62%

Dollar index · +0.04% · +0.04% · +0.04%

10-year yield · +2bp · +1bp · +3.5bp

Against This Morning's Open

• The Open called the hold priced and put the risk in the words — The Open said "with a hold close to fully priced, the 14:00 statement and Chair Warsh's 14:30 press conference carry the risk, not the decision." The hold came; the statement moved the index futures by less than 0.25%.
• It asked whether the statement would lean on December. The Open said a statement that firmed the December hike "would test gold and NQ; one that hedges it would test the dollar." The statement did neither cleanly: the dissents and the growth upgrade lean hawkish, but the policy sentence commits to nothing. Gold dipped and NQ held, so the answer is waiting on the press conference.

What This Sets Up

• Next FOMC: 8-9 December, with a Summary of Economic Projections. September's median put one more 25bp hike in 2026; December is the last meeting at which it can happen, and the dot plot will show whether the Committee still thinks it will.
• The minutes of this meeting are due Wednesday 18 November. With two dissents and a one-line policy sentence, they are where the size of the hawkish group beyond Cook and Hammack becomes visible.
• Watch whether the dissent count grows. Three in July, none in September, two today. If December brings more dissents for a hike than today, the Committee is moving toward one; if the dissents disappear in a hold, the September hike was the last.
• "Strong" is now the Committee's own word for growth. A softer run of data before December would have to overturn the statement's own description, not just a forecast.

What Is This?

• What it is: The Federal Open Market Committee's policy statement, released at 14:00 ET at the end of each of its eight scheduled meetings a year. Twelve members vote: the seven Board governors, the president of the New York Fed and four of the other eleven Reserve Bank presidents on a yearly rotation. The statement sets the target range for the federal funds rate, and the accompanying implementation note sets the operating rates the Fed uses to hold it there, chiefly interest on reserve balances.
• Why it matters: The funds rate anchors every short-term dollar rate and, through expectations of its path, the 2-year yield, the dollar and the discount rate on equities. Under Chair Kevin Warsh the statement carries no forward guidance, so the vote count and the exact wording of the policy sentence are now the main written evidence of where the Committee is leaning.
• How to read it: Start with the decision against what was priced, then the vote and the direction of any dissents. Then compare the statement word for word with the previous one: in a five-sentence statement, a single changed adjective is a deliberate signal. Check the implementation note for changes to interest on reserves or balance-sheet instructions. Meetings marked with an asterisk on the Fed's calendar (March, June, September, December) also carry economic projections and the dot plot. The press conference at 14:30 is a separate event, and it often moves markets more than the statement does.

Want the full explainer? Economic News Events, Explained breaks down this release and every other one we cover, in plain English.

_For informational purposes only. Not investment advice._