The Federal Reserve left interest rates alone on Wednesday, October 28, 2026. At 2 p.m. Eastern its policy committee said it would keep the target range for the federal funds rate at 3.75% to 4%, where it has sat since September 17. Two of the twelve members who voted wanted a quarter-point increase instead.
That September increase is still the Fed’s only change of 2026, according to its record of rate changes.
What did the Fed decide?
The Federal Open Market Committee, the group of Fed officials that sets the benchmark rate, voted 10 to 2 to hold the range at 3.75% to 4%. The statement says the decision supports “the Federal Reserve’s dual mandate,” and that the committee “is continuing its policy of maintaining ample reserves in the banking system.”
The rates the Fed sets for banks are unchanged too, according to its implementation note. The interest it pays on reserves banks keep at the Fed stays at 3.90%, and its primary credit rate, charged on short-term loans to banks, stays at 4%. Those apply from October 29.
Why did the Fed hold rates steady?
Because it wants more data. “Inflation remains elevated,” the statement says, and “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.” It closes with a line the Fed does not often use: “The Committee will deliver price stability.”
The economy, as the statement describes it, is doing well. Activity “is expanding at a strong pace.” Domestic spending “has been resilient,” productivity growth “is strong,” capital investment “is robust,” and job gains “have kept pace with the workforce,” with the unemployment rate little changed. Uncertainty remains elevated, it adds, owing in part to geopolitical developments.
Who voted against?
Lisa D. Cook and Beth M. Hammack. Both “preferred to raise the target range for the federal funds rate by 1/4 percentage point at this meeting,” the statement says. It gives no other reasoning for their votes.
No new forecasts came with this decision. Fed officials publish their projections at four of the eight meetings a year, and the next set is due at the December meeting, per the Fed’s meeting calendar.
Does a Fed hold mean mortgage rates hold?
No. They are different rates and they move on their own schedules. The federal funds rate is, in the Fed’s words, “the interest rate that banks pay to borrow reserve balances overnight.” Nobody buys a house at it.
Rates on 30-year loans answer to something broader. The Fed’s explainer says rates charged on longer-term loans are related to expectations of how monetary policy will evolve, “not just to the current level of the federal funds rate.” Freddie Mac’s weekly survey put the 30-year fixed average at 7.32% on October 22, 2026, down from 7.40% a week earlier and up from 6.19% a year before (Freddie Mac). The 15-year average was 6.68%. The next reading lands Thursday, October 29, at noon Eastern.
What a hold does settle, for the moment, is the floating side. The same Fed explainer says changes in the federal funds rate “are rapidly reflected in the rates applied to floating-rate loans,” including floating-rate mortgages and many personal and commercial credit lines. Home equity lines are the common case: the Consumer Financial Protection Bureau says HELOCs “usually have a variable interest rate, so your payments may change from month to month”.
What does a pause look like in a rental’s numbers?
Only on the borrowed money that floats. Take a $250,000 rental bought with 20% down, a $200,000 loan over 30 years at 7.32%, and rent of $2,750 with 5% vacancy. Taxes run $3,000 a year and insurance $1,400, maintenance and future repairs are budgeted at 5% of rent each, and management takes 8%. The $50,000 down payment is borrowed on a line of credit at 8%, interest only, a point above the bank prime rate of 7.00% that the Fed’s H.15 release reported for October 27, 2026.
| Each month | |
|---|---|
| Rent after 5% vacancy | $2,613 |
| Mortgage principal and interest | −$1,374 |
| Property taxes | −$250 |
| Insurance | −$117 |
| Maintenance | −$138 |
| Future repairs | −$137 |
| Management | −$220 |
| Interest on the credit line | −$333 |
| What is left | $44 |
These are example figures, not a forecast for any market.
The last line is the only one today’s decision touches. The quarter point two members voted for would have added about $10 a month to it, or $125 a year, leaving this deal near $33. The mortgage line would not have moved either way, because it is fixed. That split is the whole story of a Fed decision for most investors, and it is worth knowing which of your loans sits on which side: here is what each quarter point does to a rental’s cash flow, and what a credit line costs when it funds the down payment.
What happens next?
- Thursday, October 29: the Fed’s rates for banks take effect, and Freddie Mac posts its next weekly mortgage average at noon Eastern.
- December 8 and 9: the last FOMC meeting of 2026, the one that comes with fresh projections from Fed officials.
If your down payment or rehab money is sitting on a variable-rate line, the rate on your next statement is the number to check against the deal you underwrote. Run it through the buy and hold calculator with the payment you are actually making.