Fed Lifts Rates to 3.75%-4% and Points to One More Hike in 2026

The Federal Reserve raised its benchmark rate by 25 basis points — a quarter of a percentage point — to 3-3/4 to 4 percent on September 16, 2026, according to its post-meeting statement Federal Reserve. The federal funds rate is the overnight rate banks charge each other, and it helps set borrowing costs across the economy.

The Board of Governors voted unanimously that same day to raise the interest rate paid on reserve balances to 3.90 percent Federal Reserve. The vote was unanimous. The 10-basis-point gap below the top of the target range keeps the usual administered-rate corridor in place.

The decision closed a two-day meeting held September 15-16, 2026. The Committee released its statement at 2:00 p.m. on September 16, followed by a scheduled press conference at 2:30 p.m. that day. Participants submitted economic projections with the meeting Federal Reserve.

It was the Fed's first rate hike since 2023 CNBC. Policymakers projected one more rate hike in 2026 after the September move, a signal reported both at the time and in later coverage Reuters.

After a weaker-than-expected September jobs report, traders viewed an October 2026 rate hike as extremely unlikely CNBC. That left a gap between the Committee's median projection and what fed funds futures markets were pricing.

The FOMC holds eight regularly scheduled meetings each year, plus other meetings as needed. Minutes of regularly scheduled meetings are released three weeks after the decision. Membership changes at the first regularly scheduled meeting of the year. Each date is tentative until confirmed at the prior meeting. The calendars, statements and minutes page was last updated on September 16, 2026. A two-day meeting is scheduled for January 25-26, 2028.

The broader context here is sequencing. A September hike plus one projected move reads as a short, limited extension, not the start of a long climb. For savers that can mean slightly better short-term returns, for borrowers slightly higher costs, while trading desks watch term funding, OIS forwards and reserve demand into year-end.

In my view, the thing to watch is jobs data against that projection. The September projections reflected information available September 15-16. The soft payroll report did not change the Committee's formal stance, but it lowered market-implied odds for October. That leaves the November-December meetings, and any speeches in between, as the way the two sides come back together.

Looking at what this means for implementation, the unanimous move in the reserve rate keeps overnight rates inside the new range without changing the width of the corridor. With reserves still abundant, that administered rate remains the main day-to-day tool. Any stray print in fed funds or repo would be technical noise, not a policy signal, unless the Board changes administered rates again.