28 October, 2026
Rate Decision: HOLD [3,75-4,00] (Expected: 3,75-4,00)
- The Federal Reserve left interest rates unchanged on October 28 in the 3.75% to 4.00% range, pausing policy tightening after the September hike. The decision triggered a limited market reaction, as the statement did not include a clear signal of another move in December.
- A few minutes after the release, the S&P 500 was up 0.1%, the Dow Jones rose 0.2%, and the Nasdaq 100 hovered near flat. The yield on 10 year US Treasury bonds stood at 5.03%, up 3 basis points from the previous close.
- The most notable aspect of the meeting was dissent from two Fed officials. Beth Hammack and Lisa Cook favored a 25 basis point hike. Cook’s vote was particularly surprising, as she had not previously dissented from the consensus on rate decisions.
- The split suggests that pressure to tighten policy further remains meaningful despite the October pause.
- For investors, the lack of a hike therefore does not mean the fight against inflation is over. September consumer price inflation came in at 3.7% year over year, and higher energy prices are making it harder for price pressures to fade. The Fed must balance the risk of inflation becoming entrenched against the costs of high rates for borrowers, the housing market, and businesses.
- Implications for equities remain mixed. The pause limits an immediate increase in the cost of money, but the prospect of further hikes may restrain valuation upside, especially for technology companies and highly leveraged firms.
- The market’s direction may be shaped by Kevin Warsh’s press conference. Key will be an explanation of why the Fed chose to wait despite elevated inflation, and what conditions would trigger the next hike. Ahead of the conference, the reaction remains muted, and the October decision should be interpreted as data dependence rather than a definitive shift in monetary policy.
- USD intially shows moderate weakness against other majors, but within minutes - it returns to the pre-decision levels. More sizable move might be expected after Kevin Warsh speech.
EURUSD (M1)
Source: xStation5
Kevin Warsh Conference [LIVE]🔥
Time for a pause – what will determine the strength of the dollar? [Pre-FOMC Report]
📊Hyperscaler Results: Alphabet and Microsoft. Will results justify giant investments?
UK budget reaction
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.