Policy rate rises 25 basis points to 3.75–4.0 percent
Minutes published October 13, 2026, show the Federal Reserve held its primary credit rate at 3.75 percent on August 17 and September 9. On September 16, it approved a rise to 4.0 percent, effective September 17.
Three rates rise together
On September 16, the Federal Open Market Committee (FOMC) raised the federal funds target range 25 basis points to 3.75–4.0 percent.
The Board raised interest on reserve balances from 3.65 to 3.9 percent and primary credit from 3.75 to 4.0 percent, effective September 17. All Reserve Banks implemented the credit rate that day.
Chairman Warsh, Vice Chair Jefferson, Vice Chair for Supervision Bowman and Governors Powell, Waller, Cook and Barr approved the Board actions.
On August 17, Warsh, Bowman, Waller, Cook, Powell and Barr approved unchanged rates; Jefferson was absent.
On September 9, Warsh, Jefferson, Bowman, Powell and Barr approved unchanged rates; Waller and Cook were absent.
The Board recorded no opposition to these actions.
More districts request increases
Requests for 4.0 percent grew from Cleveland and Kansas City in August to include Chicago and Minneapolis by September 9, then Richmond, Atlanta and Dallas by September 16. Boston, New York, Philadelphia, St. Louis and San Francisco subsequently obtained approval.
Directors reported stable economic and labor conditions, adequate labor supply and moderate wage pressures.
Skilled hiring remained difficult, including AI and data-center jobs.
Input costs reflected oil, fuel, tariffs, healthcare and competition for resources from AI investment.
Credit formulas remain intact
The Board renewed both credit formulas at all three meetings.
Secondary credit remains 50 basis points above primary credit.
Seasonal credit resets every two weeks using the average of daily effective federal funds and three-month certificate-of-deposit rates over the preceding 14 days, rounded to the nearest 5 basis points.