The Federal Reserve voted 10 to 2 on Wednesday, October 28, to hold its benchmark interest rate in the 3.75% to 4% range, opting for caution heading into next week's midterm elections even as inflation has continued running above target. Consumer prices rose 3.7% year over year in September, and core inflation, which excludes food and energy, climbed 2.6%, both ahead of forecasts.
Fed Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, each preferring a quarter point rate increase instead of holding steady. Cook's dissent came as something of a surprise, since predictions ahead of the meeting had centered on Hammack alongside Dallas Fed President Lorie Logan and Minneapolis Fed President Neel Kashkari as the officials most likely to push back on holding rates.
The Fed's post meeting statement, issued under Chair Kevin Warsh, dropped September's language about supporting a timelier return to the central bank's 2% inflation target, replacing it with a pledge to gather more information before settling on its next move, a shift that signals less urgency about where policy heads from here.