The FOMC will reduce interest rate-setting meetings starting in 2027 to allow more time for policy discussions.
The Federal Reserve steered clear of a political October surprise but delivered an unexpected shift in monetary policy strategy.
After announcing that the Federal Open Market Committee, or FOMC, decided, as expected, to maintain the federal funds rate between 3.75% and 4%, Chairman Kevin Warsh announced that the body would introduce a monetary policy strategy meeting that would not vote on the federal funds rate or issue a policy statement, replacing one of its eight policy-setting meetings beginning in the autumn of 2027. It expects to replace a second policy-setting meeting with another strategy meeting in 2028.
The move aims to get monetary policy right, said Warsh. “It involves assessing near-term development at timely, regular, and information-rich intervals. But it is equally important that we reserve time and space as an intellectually diverse group for strategic deliberations, for thinking anew about big questions, looking over longer-term horizons, and focusing on the left side of the decimal point.”
The move would reduce the cadence of the FOMC’s policy meetings, “but does not rule out possible inter-meeting policy moves because of potential exigent circumstances,” said Kenneth Kim, a senior economist at KPMG. “Chair Warsh mentioned that this had occurred during the Global Financial Crisis.”
Warsh also announced that the five task forces he commissioned during the first month of his tenure on Fed communications, the Fed’s balance sheet, the use of existing data sources, inflation frameworks, and productivity will deliver their findings by year-end.
On November 16, the Productivity and Jobs task force plans to hold a field hearing to examine productivity’s implications for jobs in the near, medium, and long term.
“I, for one, am keenly interested in refining my own views on that question, but the task force decided that they wanted to hear from more people as part of their undertaking,” said Warsh.
Keeping Politics at Bay
Warsh also knocked down any suggestion that politics affected the FOMC’s decision to maintain the federal funds rate six days before the U.S. congressional mid-term elections.
“I just spent two days with my colleagues upstairs, and didn’t hear an utterance about politics,” he said. “I didn’t hear a reference to politics, elections, or what’s happening in the next week or so.”
When asked whether he or the Federal Reserve Board would be involved in the White House’s Nov. 5 closed-door hearing on allegations of mortgage fraud involving Federal Reserve Governor Lisa Cook, Warsh replied, “Not to my knowledge.”
Future Hikes
Although the FOMC unanimously supported September’s 0.25% hike in the federal funds rate, October’s decision to maintain the rate showed slight division. Fed Gov. Lisa Cook and the Federal Reserve Bank of Cleveland President and CEO Beth Hammock each voted for a 0.25% increase.
That division moves the FOMC closer to raising rates at its December meetings, said Kim. “If you look at market probabilities for December, they’re currently at an 84% chance of a rate hike. I think those dissents are in line with what the market is factoring in will happen at the next FOMC meeting.”
Rob Daly covers the economy and fintech. He can be reached at rdaly@gfmag.com
Rates will remain 3.75-4 percent even as inflation continues to rise.
Published On 28 Oct 202628 Oct 2026
The United States Federal Reserve is set to hold interest rates steady in its final monetary policy decision before the US midterm elections.
The central bank will maintain rates at 3.75-4 percent, following a 10-2 vote, in line with expectations.
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CME FedWatch, which tracks the likelihood of monetary policy decisions, indicated that there was more than a 90 percent chance rates would remain unchanged.
“Economic activity is expanding at a strong pace,” the Fed said in its press release announcing the decision on Wednesday. “While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient. Productivity growth is strong, and capital investment is robust. Job gains have kept pace with the workforce, and the unemployment rate has changed little.”
The Fed noted how inflation continues to rise.
It also added, “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.”
The most recent Consumer Price Index (CPI) report showed the annual inflation rate increasing to 3.7 percent in September, up from 3.4 percent in August, with energy prices largely accounting for the monthly surge.
There were signs earlier this month that the central bank would maintain benchmark interest rates, with the Fed’s chair for supervision, Michelle Bowman, advocating a “wait and see” approach.
“I don’t feel any urgency for taking further action at this point,” she said at this month’s International Monetary Fund-World Bank meetings in Bangkok, Thailand. “We really need to take some time and understand how things will evolve.”
The decision comes before Thursday’s release of the Personal Consumption Expenditures (PCE) Price Index report, which is used by the central bank to assess inflation and inform its decisions.
Today’s Fed announcement follows an interest-rate hike rise last month, amid surging inflation – the first increase by the central bank since July 2023. The move drew criticism from US President Donald Trump, who has repeatedly pressed the Fed to cut rates since taking office. At the time, he wrote on Truth Social that “interest rates in the United States should be 1% or less.”
The Fed’s next monetary policy meeting is scheduled for December 8-9, when it will give its final rate decision of the year.
Current forecasts point to a quarter-point interest rate increase.
In what may be one of the most comical self-owns in recent politics, the esteemed attorneys of the U.S. Department of Justice announced Monday that despite the extravagant and terrifying misuse of their investigative power under the Trump administration, they have so far been able to identify only 28 people in all of California who may have voted illegally.
“The announcement today by the United States DOJ makes the point that there is no widespread voter fraud,” California Atty. Gen. Rob Bonta said after the news conference announcing the results of “Operation Protect the Vote.”
Twenty-eight people out of about 23 million registered voters in the state — and not all of them even tried to vote, according to the feds. That’s about 1 in 820,000 folks allegedly registering or voting illegally, a rate that roughly matches how often people in the United States get struck by lightning in a given year.
So much for Trump’s endless claims that there is a vast, organized conspiracy between Democrats and undocumented people to have them vote in large numbers to steal elections. I’ll point out here that none of those charged Monday have been accused of colluding with one another or with Democratic overlords.
All the power of the government — investigative, technological, legal — has been thrown at finding these mysterious, diabolically clever ballot baddies. And now, thanks to Bill Essayli, first assistant U.S. attorney for the Central District of California, and his colleagues across this great state, we now know that all 28 of them will be held accountable, if the government can prove wrongdoing. And let’s be clear — people who vote illegally should be held accountable.
But wait, there’s more, because this election-stealing plot by immigrants certainly doesn’t stop at the state line. Seamus Hughes of Court Watch, an excellent site that tracks federal litigation, reported Monday that since the start of this administration, 169 people have been charged federally with illegally registering or voting.
That number includes the new California cases, so it means an additional 141 potentially illegal voters have been charged across the U.S. — all told about 1 in 1.25 million registered voters being accused of illegally registering or voting, making this crime slightly less likely than guessing a six-digit pin code on the first try.
There. Is. No. Election. Stealing.
But that’s where the funny part ends, because this attack on California elections is serious and just getting started.
The federal government, you’ve probably read, is suing California, claiming it gave the state a janky thumb drive with 20,000 names of registered voters that it sort of strongly suspects maybe aren’t legal voters. Important note here: The government has been very careful not to claim that these people voted illegally, just that it might be so based on questionable data, which I’ll get to in a minute.
The feds gave the state a silly 48-hour deadline to agree to change constitutional law, dump common sense and sequester these 20,000 ballots, if they were even returned, to double-check they were cast by valid voters.
When California rightfully refused — because elections are run by states, not the federal government — the federal government sued on the thinnest of legal grounds. It basically claimed that voting illegally is illegal, and if California doesn’t do exactly what Trump wants, it could be violating the Supremacy Clause of the Constitution by impeding the feds from enforcing the crime of voter fraud.
First Assistant U.S. Atty. Bill Essayli speaks at a news conference Monday at which officials announced that 28 people in California had been charged with voter fraud.
(David Butow / For The Times)
Which is basically arguing that if the state government fails to stop voter fraud using the flawed methods Trump likes, then the state is somehow stopping federal authorities from prosecuting voter fraud themselves. But didn’t they just enforce it with 28 cases?
Get ready, because “state-facilitated voter fraud,” is a new right-wing thing.
California is “being complicit in non-citizens voting in our elections, and as they were warned last week, not only is it a civil violation, but they could also face criminal consequences,” Essayli said, which if it happened would give Trumped-up charges a whole new meaning.
Essayli said state officials are not being “good faith actors,” but I’ll argue that shoe is on the other foot. The list of 20,000 alleged, suspected, maybe-maybe-not illegal voters was likely drawn from the Systematic Alien Verification for Entitlements (SAVE) program, created by Elon Musk’s Department of Government Efficiency, if you can remember that unfortunate relic.
It sought to draw data from more than a dozen government databases that were not only not compatible with such information sharing, but which had been kept separate until now for privacy reasons. Americans in general did not want the government collecting unified, know-all records of every citizen.
Luckily for us, I guess, the SAVE system can’t actually create reliable, unified records. It confuses people, convolutes them, merges records of people with similar names, and in general has been deemed unreliable by data experts.
In September, the good folks at the UCLA Voting Rights Project joined with the Coalition for Humane Immigrant Rights to sue the federal government over its use of that system to target naturalized citizens for removal from voter rolls. Turns out, the government appears to be targeting immigrants who are now citizens with these voter fraud accusations.
As I wrote about a few weeks ago, naturalized citizens make up about 1 in 10 eligible voters, and nearly a quarter of them live in California. But they also live in swing states such as Michigan, where Democrat Abdul El-Sayed may draw such voters, and in other places such as Georgia and Nevada where races might be decided by only a few votes.
These arrests and lawsuits while voting is already underway in the midterms are a not-subtle form of voter suppression. Imagine being a naturalized citizen in the Central Valley, where ICE is driving rampant fear and where Republican Rep. David Valadao is running against Democrat Randy Villegas in California’s 22nd Congressional District — one of the nation’s most closely contested races.
Would you consider sitting this election out just in case your ballot draws the frightening eye of the federal government? Even knowing that your vote is legal, what if you lived in a mixed-status household? Would it be worth risking voting if it meant a knock at the door from immigration checking on your status, and maybe finding that family member who lacks it?
Why take the risk?
“Basically, what they’re doing now is just completely harassing and intimidating naturalized citizens who are legally eligible to vote through these actions,” said Matt Barreto, co-founder of the Voting Rights Project.
And if the vote isn’t suppressed enough to give Trump the results he wants, these prosecutions and lawsuits feed the beast of conspiracy, giving Trump fodder to claim the results are fake, the election stolen.
And round and round we go, reckoning with Trump’s claims that lightning is striking everyone, everywhere, all at once, because the vote didn’t go his way.
WASHINGTON — Federal Reserve governor Lisa Cook’s lawyers say that a committee set up by the White House last week to investigate an accusation against her is “demonstrably biased,” though they did not close the door on the possibility that she would appear before the panel.
Lawyer Abbe Lowell also said in a letter Tuesday that Cook would not be able to participate in a hearing Nov. 5 because she “will be executing her official duties as Governor at financial and monetary policy meetings in Europe.”
The earliest that Cook could appear before a “committee of inquiry” that the White House set up last Friday would be after the Fed’s policy meeting Dec. 8-9, the letter said. The letter was sent to William Scharf, a counsel to President Trump.
Lowell’s comments are the latest turn in the Trump administration’s extended efforts to fire Cook from her position as one of seven members of the Fed’s board of governors. Trump has accused Cook of committing mortgage fraud in 2021, before she joined the board, a claim she has denied. No criminal charges have been filed.
No president has fired a Fed governor before, a reflection of the Fed’s traditional independence from politics. Yet Trump, who has repeatedly demanded that the central bank lower its key interest rate, has taken numerous steps that economists say have threatened that independence. The Justice Department earlier this year sought to investigate then-Chair Jerome Powell over brief testimony he had given about an extensive building renovation, though a judge threw out subpoenas in the case and it was later dropped.
Cook was appointed by former President Biden and is the first Black woman on the Fed’s board.
Trump first tried to fire Cook in August 2025, but the Supreme Court ruled earlier this year she could remain in her position while litigation continued. The court also suggested, in a footnote to the ruling, that Trump could try again to fire her if the administration provided her adequate notice and an opportunity to respond. The committee of inquiry announced by the White House last Friday is an effort to meet those conditions.
Under the law governing the Fed, the president can only fire a Fed governor “for cause,” but the Supreme Court didn’t address whether Cook’s actions met that standard. The committee of inquiry will ultimately recommend whether there is cause to fire Cook, a White House memo last week said.
Lowell also said in the Tuesday letter that “we have significant concerns regarding the objectivity and fitness of the committee for its assigned purpose.”
One of its three members, Kevin Hassett, a top economic adviser to Trump, has already said the president has “cause” to fire Cook, the letter noted. The other two members — Labor Secretary Keith Sonderling and chair of the Equal Employment Opportunity Commission Andrea Rich — are also Trump appointees.
“A hearing with demonstrably biased members, unspecified additional allegations, and an unclear schedule for the disclosure of any additional evidence – with no explanation for why it was not previously produced – is not a process that respects the appearance or history of independence,” Lowell’s letter said.
WASHINGTON — President Trump opened another chapter in his effort to fire Federal Reserve Governor Lisa Cook Friday by establishing a “committee of inquiry” to investigate allegations that she made false statements in mortgage applications.
The inquiry will include a hearing at the White House Nov. 5, Trump said in a written memo, that Cook “shall” attend to answer questions from the committee. The hearing wouldn’t be public but a transcript would be published, the memo said.
Trump’s extraordinary demand that Cook testify before the committee will likely renew concerns about threats to the Federal Reserve’s independence as the president demands the central bank cut its key interest rate. Just last month, the Fed raised its key rate instead, led by Chairman Kevin Warsh, whom Trump appointed earlier this year.
“As President, it is my job to ensure the laws are faithfully executed, including by firing subordinates who cannot be trusted to tell the truth and follow the law,” Trump wrote in the memorandum.
Trump and some of his economic advisers have blamed the Fed’s broader rate-setting committee, which includes 12 voting members and 19 officials in total, for the rate hike. Cook is one of the 12 participants on the committee that votes on interest-rate decisions. The vote to lift rates Sept. 16 was unanimous.
The move follows a Supreme Court ruling in June that Cook could keep her job after Trump sought to fire her last year. That ruling included a footnote that said nothing prevented Trump from “trying again” as long as she was given proper notice and an opportunity to respond to the charges.
Cook has denied any wrongdoing and has not been charged with a crime.
