US Fed keeps interest rate unchanged at 3.5-3.75 pct

WASHINGTON -- The US Federal Reserve on Wednesday kept the target range for the federal funds interest rate unchanged at 3.5 percent to 3.75 percent at its first policy meeting of 2026.

The decision follows three consecutive rate cuts in the second half of 2025.

"Available indicators suggest that economic activity has been expanding at a solid pace. Job gains have remained low, and the unemployment rate has shown some signs of stabilization. Inflation remains somewhat elevated," said the Federal Open Market Committee (FOMC) in a statement.

"In support of its goals, the Committee decided to maintain the target range for the federal funds rate at 3-1/2 to 3-3/4 percent," the statement said. "In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks."

The FOMC reiterated its commitment to supporting maximum employment and returning inflation to its 2 percent objective.

Of the 12 FOMC members, 10 voted for keeping the rate unchanged. Stephen Miran and Christopher Waller voted against the action, preferring to lower the interest rate by 25 basis points at the meeting.