The Federal Reserve raised its benchmark federal funds target range by a quarter point to 3.75%–4.00% at its September 15–16, 2026 meeting. The vote was unanimous. The statement described economic activity as solid while saying inflation remained elevated; the accompanying projections showed stronger expected 2026 growth and a lower unemployment rate than in June, alongside slightly higher inflation and a higher median year-end federal funds rate projection.
For personal-finance readers, the meeting is a snapshot of the Fed’s assessment and policy decision—not a guarantee of what it will do next or how a particular loan rate will move.
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What did the Fed decide in September?
On September 16, 2026, the Federal Open Market Committee (FOMC) voted 12–0 to raise the federal funds target range by 0.25 percentage point, to 3.75%–4.00%. The Committee said the action supported its dual mandate and that it would continue maintaining ample reserves in the banking system. The decision and the Committee’s rationale appear in its September 16 statement.
The statement said, “Economic activity is expanding at a solid pace,” and “Inflation remains elevated.” It pointed to resilient domestic spending, strong productivity growth, robust capital investment, and job gains that had kept pace with the workforce. It said unemployment had changed little, while uncertainty remained elevated in part because of geopolitical developments. These are the Committee’s characterizations, not a separate assessment of the economy.
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What changed in the Fed’s 2026 projections?
The Summary of Economic Projections (SEP), released with the statement, reports participant medians—not outcomes that have already occurred. For GDP growth and inflation, the figures below are changes from the fourth quarter of the prior year to the fourth quarter of the indicated year. Unemployment is the average rate in that year’s fourth quarter. The federal funds rate is a year-end projection. The Federal Reserve’s September projection tables include the June comparison.
| Measure | September 2026 median | June 2026 median | Change in median |
|---|---|---|---|
| Real GDP growth, 2026 | 2.3% | 2.2% | Up 0.1 percentage point |
| Unemployment rate, 2026 | 4.1% | 4.3% | Down 0.2 percentage point |
| PCE inflation, 2026 | 3.7% | 3.6% | Up 0.1 percentage point |
| Core PCE inflation, 2026 | 3.4% | Not stated in the June comparison cited here | Not stated |
| Federal funds rate, year-end 2026 | 4.1% | 3.8% | Up 0.3 percentage point |
The June and September figures are medians of individual participant projections. Their movement indicates how the median outlook changed; it is not a new policy decision, a prediction guaranteed to come true, or a commitment to a particular rate at a future meeting.
What does the dot plot mean—and what does it not mean?
The SEP’s federal funds rate projections are commonly called the “dot plot.” Each participant reports an assessment of the most likely economic outcome and the appropriate policy path given information available at the meeting and that participant’s own outlook. The projections also include participants’ assessments of uncertainty and the balance of risks.
There is no single collective Fed forecast hidden in the median, and the median is not a promised rate path. Future FOMC decisions are made at future meetings. To compare outlooks, match the same measure and horizon—for example, the median participant projection for the federal funds rate at year-end 2026—rather than treating a projected rate as the Committee’s next move.
How did the projections look beyond 2026?
The September SEP also published median projections for later years. As with the 2026 figures, GDP growth and inflation are fourth-quarter-to-fourth-quarter changes, unemployment is the fourth-quarter average, and the funds rate is a year-end projection.
| Year | Real GDP growth | Unemployment rate | PCE inflation | Federal funds rate |
|---|---|---|---|---|
| 2027 | 2.4% | 4.1% | 2.3% | 4.1% |
| 2028 | 2.2% | 4.1% | 2.1% | 3.9% |
| 2029 | 2.1% | 4.1% | 2.0% | 3.6% |
| Longer run | 2.0% | 4.2% | 2.0% | 3.2% |
The longer-run figures are participants’ estimates of levels consistent with their views of longer-run conditions, not a schedule of future decisions. The SEP does not collect a longer-run median projection for core PCE inflation.
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What should personal-finance readers take from the decision?
The meeting establishes the target range and records the Fed’s view that activity was solid while inflation was still elevated. It does not establish how mortgage, credit-card, auto-loan, or savings-account rates changed in response. Those rates depend on factors beyond the target range, and the official meeting materials cited here do not measure their market response. Avoid treating the SEP as individualized financial advice or as a reliable forecast of the rate on a specific account or loan.
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What documents should you watch next?
The statement gives the decision and its public rationale; the SEP sets out participants’ projections; and the minutes provide a more detailed record of the meeting’s discussion and votes. The Chair’s press conference is another venue for explanation and questions. The Federal Reserve’s meeting calendar listed October 7, 2026, for release of the September minutes and October 27–28 for the next scheduled meeting. The Fed’s FOMC information page explains the roles of statements, minutes, and press conferences.
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