Federal Reserve Raises Interest Rates Amid Solid Economic Growth

The Federal Reserve's Federal Open Market Committee (FOMC) released a statement on September 16, 2026, announcing a decision to raise the target range for the federal funds rate by a quarter percentage point to 3.75% to 4%. This move is part of the Fed's ongoing efforts to support its dual mandate of maximum employment and price stability. The decision reflects the Committee's assessment of the current economic conditions, including solid economic growth and persistent inflationary pressures.

Policy Decision & Vote

The FOMC's decision to increase the federal funds rate by 0.25 percentage points was made with unanimous consent, as indicated by a 12 – 0 vote. This adjustment is intended to help manage inflationary pressures and support the Federal Reserve's objectives of maximum employment and price stability.

Economic Assessment

The statement from the FOMC highlights that economic activity is expanding at a solid pace. Despite elevated uncertainty due to geopolitical developments, domestic spending has shown resilience. The Committee noted that productivity growth is strong, and capital investment remains robust. Additionally, job gains have kept pace with the workforce, and the unemployment rate has experienced little change.

However, the FOMC acknowledged that inflation remains elevated, which has necessitated the current policy action to facilitate a more timely return to the Committee's 2% inflation goal. The Fed's commitment to delivering price stability remains a central focus of its monetary policy strategy.

Forward Guidance

While the statement did not provide explicit forward guidance on future rate adjustments, the FOMC's actions and comments suggest a continued focus on managing inflation and supporting economic growth. The Committee's decision to raise rates reflects its ongoing assessment of economic conditions and its commitment to achieving its dual mandate.

What Comes Next

The FOMC's next meeting is expected to further evaluate economic conditions and adjust monetary policy as necessary to achieve its objectives. The Committee will continue to monitor a wide range of economic indicators, including inflation, employment, and geopolitical developments, to inform its future policy decisions.

For further information, media inquiries can be directed to the Federal Reserve's media relations team via email at media@frb.gov or by phone at 202-452-2955.