In brief
On Oct. 28, 2026, the Fed’s FOMC voted to leave the benchmark rate unchanged, keeping a 3.75‑4% target range. Ten committee members approved the pause while two urged a hike. The decision came after a recent 0.25‑point rise and signaled the Fed may test another increase later this year. U.S. and South Korean stocks moved on the news, and market analysts noted the pause could precede a year‑end hike.
On Wednesday, October 28, 2026, the U.S. Federal Reserve held its benchmark federal funds rate steady at a 3.75‑4.00 percent range in a 10‑2 vote, according to reports from Xinhua, Yonhap, and Kyodo News.
In the two‑day FOMC meeting, 12 members cast ballots, with ten supporting the continuation of the target range and two—Fed Governor Lisa Cook and Cleveland Fed President Beth Hammack—favoring an immediate 25‑basis‑point hike.
The Fed’s policy statement emphasized a strong pace of economic activity: expanding domestic spending, robust capital investment, and solid productivity gains. It also highlighted that, “unemployment has changed little and job gains have kept pace with the workforce.” Nonetheless, the statement noted that inflation remains high and that the committee will monitor incoming data to guide policy toward a 2 percent goal.
Fed Chair Kevin Warsh said at a press briefing that inflation “remains too high.” He warned that energy and related prices had risen again recently and that the Fed must keep price pressures from broadening.
“Our job is to ensure that relative price changes in some sectors do not broaden out across the economy. It’s our responsibility to get inflation down,”Warsh told reporters in Washington.
The decision was seen as a cautious response to inflation and the recent 0.25‑point hike in September. According to a note from Pacific Investment Management Co. (PIMCO), the Fed would likely hold rates steady again at the next October meeting before delivering a further quarter‑point increase in December.
U.S. equities rallied on the Fed announcement. The Dow Jones Industrial Average climbed 97.53 points, or 0.19 %, to 52,475.1. The S&P 500 added 21.38 points, or 0.28 %, to 7,743.98, while the Nasdaq Composite Index closed up 72.04 points, or 0.27 %, at 26,549.85. Technology and energy sectors led gains; utilities and real estate fell.
South Korean markets also climbed modestly. The KOSPI rose 10.2 points, or 0.17 %, to 6,022.64 as investors reacted to the U.S. pause and anticipated Samsung Electronics’ third‑quarter earnings driven by strong memory‑chip demand.
Market watchers noted that the Fed’s pause leaves the interest‑rate gap between the U.S. and South Korea at up to one percentage point. The Fed also announced a schedule change for 2027, planning to hold seven of eight FOMC meetings that year.
Analysts indicated that the October pause sets the stage for a potential year‑end rate increase, as the committee will review other economic data—including two employment reports and an upcoming consumer‑price index release—before future meetings.
