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Economy & Your Money

Fed holds interest rates steady six days before midterm elections

Two Fed officials voted to raise rates, and investors widely expect a quarter-point hike in December after annual inflation hit 3.7% in September.

16 news outlets reported this
Liberal6 outletsCenter5 outletsConservative5 outlets
Published 4 min readMoney and daily life
Overview

The left its benchmark interest rate unchanged at a range of 3.75% to 4% on Wednesday, Oct. 28, six days before the elections. In September it raised rates by a quarter point, its first increase in three years. The vote was 10-2.

Governor Lisa Cook and Cleveland Fed President Beth Hammack wanted another quarter-point increase. The Fed's statement said "remains elevated" and that more information will help it set policy. Fed Chair Kevin Warsh said politics played no role in the decision, according to MS NOW and the New York Post.

MS NOW and the BBC quote him saying the September increase is "starting to work some." Annual consumer price inflation rose to 3.7% in September from 3.4% in August, against the Fed's 2% target. Several outlets tie higher fuel prices to the war with Iran.

Several outlets report that investors and economists widely expect another quarter-point increase at the next meeting, Dec. 8-9. Employers added 29,000 jobs in September, down from 162,000 in August, according to ABC News, UPI and the Daily Caller. President Donald Trump has called for lower rates.

Outlets give different figures for September's monthly rise in consumer prices.

Three sides of the story

Liberal6 outlets

CBS News reports the hold and the 10-2 vote. It quotes Warsh calling inflation "too high" and describing the debate as "a heck of a family fight." It also covers Warsh's plan to set aside one meeting a year, from 2027, for policy discussion without a rate vote, and includes economists and loan-cost analysts.

MS NOW, running AP text, stresses Warsh's view that the hikes are working. It notes this is Cook's first dissent, that the Trump administration has tried to remove her, and that rates hit 7.4%. NBC News, in a preview, centers on voters.

It cites its poll putting Trump's approval on the cost of living at 27% and says voters blame his Iran war and for higher prices. The Guardian, also in a preview, quotes NYU professor Nicholas Economides saying rate hikes cannot cure inflation caused by supply shocks. It also reports Warsh's suggestion that inflation has persisted beyond the war.

Center5 outlets

BBC News frames its report as an explainer. It gives Warsh's quotes and the vote, then walks through how the Fed rate touches mortgages, credit cards and savings, and how rates have moved since 2008. Straight Arrow News describes the hold as "more like a pause than a resolution."

It quotes Diane Swonk, chief economist at KPMG, on the Fed moving with caution, and cites gasoline up 9.1% in a month and core inflation of 2.6%. UPI reports the dissents and Warsh's plan to cut the number of rate-vote meetings, from eight to seven next year and six in 2028. It quotes Heather Long, chief economist at Navy Federal Credit Union, who says the election lowers the odds of a hike.

UPI also recalls Trump's post after the September hike urging lower rates. The Hill reports the Fed voted 10-2 to hold rates.

Conservative5 outlets

The Daily Caller lays out inflation data: consumer prices up 0.6% in September, gasoline up 9.1%, producer prices up 1.3%, and an AP-NORC poll on voter concerns. It also notes Warsh told in April that a 2020 Fed policy shift laid the foundation for the inflation surge. The New York Post leads with investor bets, citing 85% odds of a December hike on CME FedWatch.

It reports Warsh's plan to reduce rate votes, noting critics say that would slow the Fed's reaction, and Warsh's answer that no one at the Fed is involved, to his knowledge, in a White House hearing on Cook. Breitbart highlights the Fed's upgrade of growth to a "strong pace" and reads it as giving officials more room to tighten. The Daily Wire notes the Fed held despite Trump's calls for lower rates.

It quotes Trump saying the board "would like to see the country do badly," and quotes Secretary Scott Bessent blaming the energy shock for headline inflation.

Where outlets disagree
  • How much consumer prices rose from August to September
    • MS NOW: The consumer price index rose 0.3% in both August and September.
    • Straight Arrow News: Consumer prices rose 0.6% from August to September, according to the Bureau of Labor Statistics.
    • Daily Caller: The CPI increased 0.6% in September, according to the BLS report.
Money and daily life

For borrowers, the pause means little change for now. BBC News says rates on new mortgages and business loans are less likely to move, and savings rates are unlikely to rise. LendingTree analyst Matt Schulz told CBS News a December hike is possible, though far from guaranteed, and could make holiday debt costlier. MS NOW reports the average 30-year mortgage rate hit a three-year high of 7.4% earlier this month, then slipped a bit.

Official statements
All sources: 27 articles from 16 outlets

Liberal (12)

Center (7)

Conservative (8)

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1 min
Federal Reserve (the Fed)

The central bank of the United States. It sets the key interest rate, which moves the rates on loans, mortgages and savings.

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Midterm elections

US elections halfway through a president's four-year term. The whole House, a third of the Senate and many governors are elected. In 2026 Election Day is November 3.

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Inflation and the CPI

How fast prices rise. In the US it is measured by the consumer price index, published monthly for a basket of goods and services. “Core” inflation leaves out food and energy, whose prices swing the most.

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Mortgage rates

The interest on a home loan. The usual US mortgage is fixed for 30 years, and its rate follows long-term government bonds more than the Fed's rate, so it does not always fall when the Fed cuts.

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Tariff

A tax on imported goods, paid at the border by the importer, who usually passes some or all of it into prices. Governments use tariffs to protect their producers or to press the other side in a trade dispute.

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Congress

The US parliament: the Senate and the House of Representatives. A bill becomes law when both pass it and the president signs it.

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Treasury Department

The federal finance ministry: it collects taxes through the IRS, pays the government's bills and borrows by selling bonds. The interest on those bonds steers mortgage and loan rates.

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