Fed Raises Interest Rates to 3.75%–4.00%, First Hike in Over Three Years

The Federal Reserve on Wednesday, September 16, 2026, raised its benchmark federal funds rate by a quarter point to a range of 3.75%–4.00% — the first rate hike since July 2023 and a reversal from new Chair Kevin Warsh's prior holds. The FOMC voted unanimously, citing persistently elevated inflation driven in large part by soaring fuel prices tied to the ongoing US-Israel war with Iran, which has pushed oil prices higher and broadened price pressures across the economy. Updated Fed projections point to one additional rate increase before year-end, with rates expected to hold steady through 2027. The hike raises borrowing costs for mortgages, auto loans and credit cards just as Trump campaigns on economic performance ahead of the November midterms, and comes days after a Fox News poll found 63% of voters say his administration has made the economy worse.