The Federal Reserve left its benchmark interest rate unchanged at its October meeting, holding the federal funds target range at 3.75% to 4.00%, with two members dissenting in favor of a 25-basis-point increase.
At last week's Federal Open Market Committee meeting, the Fed held its benchmark rate steady, with two members dissenting in favor of a quarter-point increase, according to a market commentary published November 2. Policymakers emphasized that inflation remains elevated, leaving the possibility of additional tightening on the table.
The effective federal funds rate was 3.88% on November 3, according to Federal Reserve data, while the bank prime loan rate stood at 7.00% and the discount window primary credit rate at 4.00%. The 10-year Treasury yield finished the previous Friday near 4.94%, about six basis points below the previous week.
The overall tone of the meeting was decidedly hawkish, according to a separate market commentary, with policymakers highlighting continued labor market stability while reiterating concerns about inflation. Both Lisa Cook and Beth Hammack dissented in favor of a 25-basis-point rate increase.
Perhaps the most significant development was not the rate decision itself, but the Fed's announced changes to future FOMC meetings. Beginning in late 2027, one annual meeting will be dedicated exclusively to longer-term monetary policy strategy, while the remaining meetings will continue to focus on interest-rate decisions. Starting in 2028, the Fed plans to hold two strategy-focused meetings and six rate-decision meetings annually. Markets remain particularly sensitive to economic releases that could influence the Fed's next policy decision in December.
