Fed minutes point to another interest-rate hike in 2026

The Federal Reserve indicated that another interest-rate hike would be appropriate before the end of 2026, according to the minutes of its September meeting published on October 7, 2026. Policymakers noted they will approach each upcoming gathering with an open mind, basing future decisions on incoming economic data and the balance of risks.

At that September meeting, the Federal Open Market Committee raised rates by 25 basis points to a target range between 3.75% and 4.00%. That decision marked the central bank's first monetary policy tightening move since July 2023. Officials highlighted that inflation stayed elevated, the labor market remained near full employment with signs of strengthening, and economic activity continued to expand at a solid pace.

Recent macro data supported the policy stance. The United States government revised second-quarter 2026 GDP growth to an annualized rate of 2.2%, up from the previously reported 1.5%, with a quarterly acceleration of 0.7%. First-quarter GDP was also revised upward by four tenths of a percentage point, from 2.1% to 2.5%. Meanwhile, the Department of Commerce reported that the personal consumption expenditures price index stood at 3.4%, while core PCE inflation reached 3.0%.

Market pricing tracked by the CME tool showed the probability of another rate hike fell to 79.6% on October 7, 2026, down from 84.5% on October 6, 2026, while remaining firmly in favor of an increase.