Key takeaways from Fed decision to raise interest rates

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Here are key takeaways from the Federal Reserve’s interest-rate decision on Wednesday:

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Federal Open Market Committee votes unanimously to raise its benchmark interest rate to a target range of 3.75 per cent – four per cent

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“Dot plot” of rate projections shows 16 of 18 officials expect to raise interest rates at least one more time by the end of 2026, with four pencilling in two additional rate hikes and the median forecast drifting up to 4.1 per cent from 3.75 per cent in June; the median official saw rates remaining at 4.1 per cent in 2027, though eight officials saw them at 4.4 per cent

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Fed says Wednesday’s policy action “will support a timelier return to the committee’s two per cent goal”

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Median Fed official sees core inflation at 3.4 per cent by end of 2026, up slightly from 3.3 per cent forecast in June; sees GDP growth of 2.3 per cent, compared with 2.2 per cent previously

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Fed says “While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient,” and repeats that “productivity growth is strong, and capital investment is robust”
Fed repeats job gains “have kept pace with the workforce, and the unemployment rate has changed little”

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—With assistance from Andrew Ackerman.

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