Fed officials see another rate hike, but not necessarily this month

The Federal Reserve is signaling another interest-rate increase before the end of the year.

Minutes from the Fed’s September meeting showed that 16 of 18 officials expected another rate hike in 2026. Policymakers said stubborn inflation and a steady labor market could warrant higher borrowing costs, although they stressed that each decision will depend on fresh economic data.

But that didn’t necessarily mean they expected to hike rates on October 28, since they’re set to meet again in December.

The Fed raised its benchmark rate by 0.25 percentage point last month, the first hike in three years.

Core inflation hit 3% in August, while headline inflation reached 3.4%.

Officials said economic growth has strengthened and the labor market remains near full employment.

Treasury yields have also surged to levels not seen since 2002, reflecting expectations for higher rates, solid growth and strong investment in artificial intelligence.