# Fed holds rates at 3.75% to 4% while two officials vote to raise them

Governor Lisa Cook and Cleveland Fed President Beth Hammack voted for a quarter-point increase, and gold fell about 0.6% to near $4,035 an ounce as traders priced in a central bank now debating a hike, not a cut.

- Published: 2026-10-29T05:12:07.061Z
- Canonical: https://polylog.news/2026-10-29/fed-holds-rates-at-3-75-to-4-while-two-officials-vote-to-rai
- Publisher: Polylog (Global desk)
- Section: macro
- Sources: [Federal Reserve](https://www.federalreserve.gov/newsevents/pressreleases/monetary20261028a.htm), [Financial Times](https://www.ft.com/content/f31fccd8-e9b6-4b01-989d-790ca6bb4d29?syn-25a6b1a6=1), [Bitcoin Magazine](https://bitcoinmagazine.com/markets/bitcoin-price-trades-near-81500-fed)

The Federal Open Market Committee (FOMC) left the federal funds rate in a range of 3.75% to 4% on Wednesday, [according to its statement](https://www.federalreserve.gov/newsevents/pressreleases/monetary20261028a.htm). The statement said inflation "remains elevated" and that more information would help the committee set a policy that ensures a "timely return" to its 2% goal. The vote was [10-2, as Bitcoin Magazine and other outlets reported](https://bitcoinmagazine.com/markets/bitcoin-price-trades-near-81500-fed), with both dissenters favoring tighter policy. [Fox Business](https://www.foxbusiness.com/economy/federal-reserve-interest-rate-decision-october-28-2026) and [Kitco](https://www.kitco.com/news/article/2026-10-28/gold-price-drops-4035oz-fed-votes-10-2-favor-rate-hold) reported that Governor Lisa Cook and Beth Hammack, president of the Cleveland Fed, each voted to raise the range by a quarter of a percentage point.

The [Financial Times](https://www.ft.com/content/f31fccd8-e9b6-4b01-989d-790ca6bb4d29?syn-25a6b1a6=1) described the decision as a hold "despite intensifying inflation." It also reported that the Fed will hold seven policy votes next year instead of the customary eight. At his press conference, Kevin Warsh, the Fed chair, said the committee will still meet eight times but will devote one meeting entirely to monetary strategy starting in 2027. [Yahoo Finance's live coverage](https://finance.yahoo.com/economy/policy/live/fed-meeting-live-updates-federal-reserve-october-meeting-kevin-warsh-161129201.html) quoted him saying politics played "no role" in a decision made six days before the midterm elections.

The dissents came during an oil shock. Brent crude has traded between $113 and $117 this week on reports of renewed US strikes on Iran. A Fed that holds its nominal rate steady while energy-driven prices rise is loosening policy in real terms without describing it that way. Two voting members have now said on the record that this setting is the wrong one.

Hard assets sold off on the hawkish tilt. Spot gold fell 0.6% to $4,035.48 an ounce after the statement, [Kitco reported](https://www.kitco.com/news/article/2026-10-28/gold-price-drops-4035oz-fed-votes-10-2-favor-rate-hold), and silver fell by more than gold did, [according to Kitco's afternoon report](http://www.kitco.com/news/article/2026-10-28/gold-steadies-silver-falls-fed-holds-rates-two-officials-favor-hike-kitco). Bitcoin held near $81,000 immediately after the decision, [Bitcoin Magazine said](https://bitcoinmagazine.com/markets/bitcoin-price-trades-near-81500-fed), then fell below $80,000 in Asian trading as technology shares dropped.

## What this means

The channel here is real interest rates. Each month the Fed holds the range at 3.75% to 4% while oil above $110 a barrel pushes up prices, real policy rates fall further. The two dissents tell markets the next move is more likely to be up than down. That pressures long-duration equities and emerging-market currencies that borrow in dollars, and in the short run it has pressured gold, which fell on the decision. The consensus had expected a quiet hold before the midterms. The new information is that a sitting governor joined a regional bank president in calling for a hike. The closest precedent is the 1973-74 oil shock, when the Fed under Arthur Burns held off on tightening as energy costs rose and inflation became entrenched, which later forced much higher rates under Paul Volcker. The desk's read is that the December meeting will bring either a quarter-point increase or a larger group of dissenters, provided Brent stays above $100 and the next consumer price reports stay firm. A negotiated de-escalation with Iran that pushes crude back toward pre-October levels would weaken the case for a hike and prove this read wrong.

## What to watch

- The next US consumer price report. A further rise in core prices would give the hike camp the data it needs before December.
- Whether more regional Fed presidents argue for a hike in speeches over the next month. More dissent beyond Cook and Hammack would shift the median vote.
- Brent crude after the November 3 midterms. Energy is now the main input to the Fed's inflation debate.