Fed Rate Decision: Weakest Job Growth Before Any of 52 Fed Hikes Since 1994
The Fed decides Wednesday with its rate at 3.75% to 4%, after most officials signaled in September that another hike was likely this year, and inflation has since risen to 3.7%. Hiring points the other way, since on today’s revised data job growth before September’s hike was the weakest before any of the Fed’s 52 increases since 1994.
The short answer. The Federal Reserve releases its decision at 2:00 p.m. ET on Wednesday, October 28. Chairman Kevin Warsh holds his press conference at 2:30 p.m. Inflation is still well above the Fed’s 2% goal, and most officials said in September that another increase was likely by year end. In our reading, that is the case for raising again. Payroll growth of 0.34% in the year before the September hike, weaker than before any of the Fed’s 51 earlier increases since 1994 by our count, is the case for waiting. Lower immigration means fewer new jobs are needed now, which softens that case. For borrowers, the average 30-year mortgage rate had already risen to 7.32% by October 22, from 6.95% the day after the September hike.
The Fed's rate, inflation and hiring going into Wednesday
What we calculated
- Job growth before the September hike, 0.34%: total nonfarm payroll growth over the 12 months to August 2026 on today’s revised data, against at least 1.15% before each of the Fed’s 51 earlier increases since February 1994.
- Jobs added in the year before the hike, 543,000: the same 12-month change in jobs, against 1.5 million before the slowest earlier case, June 2004.
- PCE inflation below the Fed’s estimates, by 0.2 point on both measures: BEA published August inflation of 3.4% and core inflation of 3.0%, against the September estimates of 3.6% and 3.2%.
- Rate cushion over inflation, about 0.2 point: the range midpoint (3.875%) minus September CPI inflation of 3.7%; against August core PCE it is about 0.9 point.
- Cushion in July 2023, about 2 points on CPI and 1.1 on core PCE: the midpoint then (5.375%) minus each 12-month rate; since then the midpoint fell 1.5 points and CPI inflation rose about 0.4 point.
On this page
- What is the current Fed interest rate before the Fed meeting?
- What did the Fed say after its September rate hike?
- How does inflation compare with the Fed’s interest rate?
- How weak was hiring before the September Fed hike?
- Will the Fed raise, hold or cut rates on Wednesday?
- How have mortgage rates moved since the September Fed hike?
- How we counted
- Frequently asked questions
What is the current Fed interest rate before the Fed meeting?
The Fed’s target for its benchmark rate is a range of 3.75% to 4%. It got there on September 16, when the Fed raised rates for the first time since July 2023.
The September move was a quarter point, approved 12 to 0, according to the Fed’s September 16 statement. It put the federal funds rate back where it stood after the October 2025 cut, as the Fed’s target range history on FRED shows.
The year did not start that way. In January two officials voted for a cut, and by July three voted to raise rates while the rest held. Kevin Warsh chaired his first meeting in June, and the September hike was the first rate change under him.
Show the data
| Date | Event |
|---|---|
| 2026-01-28 | Hold at 3.50% to 3.75%, vote 10-2. |
| 2026-03-18 | Hold at 3.50% to 3.75%, vote 11-1. |
| 2026-04-29 | Hold at 3.50% to 3.75%, vote 8-4. |
| 2026-06-17 | Hold at 3.50% to 3.75%, vote 12-0. First meeting under Chairman Warsh. |
| 2026-07-29 | Hold at 3.50% to 3.75%, vote 9-3. Three preferred a hike. |
| 2026-09-16 | Raise to 3.75%-4.00%, vote 12-0. |
| 2026-10-28 | Decision due at 2:00 p.m. ET. |
Wednesday’s statement is due at 2:00 p.m. ET and the press conference at 2:30 p.m., both on the Fed’s October calendar. This meeting brings no new set of officials’ projections; the meeting calendar attaches those to the December 8-9 meeting. We do not predict Wednesday’s decision here. What follows is what the Fed said and what the data since then show.
What did the Fed say after its September rate hike?
The Fed’s statement said inflation “remains elevated,” and the minutes say most officials expected one more increase before the end of 2026. None of the 18 officials projected a lower rate this year.
The September statement was three short paragraphs, ending with “The Committee will deliver price stability.” In our reading, that line tells readers the Fed is ready to raise again if inflation does not come down. The minutes released October 7 said it in plain terms: “most participants assessed that another increase in the target range for the federal funds rate would likely be appropriate by year end.” The next sentence adds that participants “approached each meeting with an open mind,” which leaves them room to wait.
The officials’ own projections say the same thing in numbers. In the September projections, 12 of the 18 put the rate one quarter point higher by the end of 2026. Four put it two steps higher and two left it where it is.
Show the data
| Category | Value |
|---|---|
| A cut | 0 |
| No change | 2 |
| One more hike | 12 |
| Two more hikes | 4 |
The two meetings left in 2026 are this one and December’s. The projections only show where each official expects the rate to end the year, so they do not say which meeting. Warsh would not say either. “My business is to not give forward guidance,” he told reporters on September 16, according to the press conference transcript. He added that “Trends matter. Data points are noisy,” which in our reading means no single report since September is meant to settle the timing on its own.
Since then, officials have spoken about what comes next. Governor Christopher Waller said on October 8 that further increases “do not need to come at consecutive meetings,” in a speech in Istanbul. Governor Michael Barr said on September 29 that “further policy adjustments are likely to be needed” to bring inflation down in time, in a speech in Detroit. In our reading, that points to more increases. Our coverage of the September hike and the minutes has the full detail.
How does inflation compare with the Fed’s interest rate?
Inflation is above the Fed’s 2% goal on every measure. September’s consumer price reading of 3.7% sits just under the middle of the Fed’s range. August PCE inflation, the measure used for the Fed’s goal, came in below its September estimate.
The September consumer price index rose 3.7% over the year, up from 3.4% in August. The Bureau of Labor Statistics said gasoline accounted for over half of the monthly increase.
Because the Fed sets a range, we compare inflation with its midpoint, 3.875%. Against September’s CPI the gap is about 0.2 point. Against core PCE inflation it is about 0.9 point; core PCE is the Commerce Department gauge that leaves out food and energy. Neither gap is a Fed threshold; each only describes where the rate sits.
The CPI gap was about 2 points when the last hiking cycle ended in July 2023. Most of the narrowing came from the Fed’s cuts since then, more than from higher inflation, and on core PCE the change is much smaller.
Show the data
| Category | Fed target range midpoint | CPI inflation, 12 months (adjusted) | Note |
|---|---|---|---|
| Jan ’23 | 4.4% | 6.3% | |
| Feb ’23 | 4.6% | 6.0% | |
| Mar ’23 | 4.9% | 4.9% | |
| Apr ’23 | 4.9% | 5.0% | |
| May ’23 | 5.1% | 4.1% | |
| Jun ’23 | 5.1% | 3.1% | |
| Jul ’23 | 5.4% | 3.3% | Last increase of the 2022 to 2023 cycle |
| Aug ’23 | 5.4% | 3.7% | |
| Sep ’23 | 5.4% | 3.7% | |
| Oct ’23 | 5.4% | 3.3% | |
| Nov ’23 | 5.4% | 3.1% | |
| Dec ’23 | 5.4% | 3.3% | |
| Jan ’24 | 5.4% | 3.1% | |
| Feb ’24 | 5.4% | 3.2% | |
| Mar ’24 | 5.4% | 3.5% | |
| Apr ’24 | 5.4% | 3.4% | |
| May ’24 | 5.4% | 3.2% | |
| Jun ’24 | 5.4% | 3.0% | |
| Jul ’24 | 5.4% | 2.9% | |
| Aug ’24 | 5.4% | 2.6% | |
| Sep ’24 | 4.9% | 2.4% | |
| Oct ’24 | 4.9% | 2.6% | |
| Nov ’24 | 4.6% | 2.7% | |
| Dec ’24 | 4.4% | 2.9% | |
| Jan ’25 | 4.4% | 3.0% | |
| Feb ’25 | 4.4% | 2.8% | |
| Mar ’25 | 4.4% | 2.4% | |
| Apr ’25 | 4.4% | 2.3% | |
| May ’25 | 4.4% | 2.4% | |
| Jun ’25 | 4.4% | 2.7% | |
| Jul ’25 | 4.4% | 2.7% | |
| Aug ’25 | 4.4% | 2.9% | |
| Sep ’25 | 4.1% | 3.0% | |
| Nov ’25 | 3.9% | 2.7% | October 2025 CPI was not published |
| Dec ’25 | 3.6% | 2.7% | |
| Jan ’26 | 3.6% | 2.4% | |
| Feb ’26 | 3.6% | 2.4% | |
| Mar ’26 | 3.6% | 3.3% | |
| Apr ’26 | 3.6% | 3.8% | |
| May ’26 | 3.6% | 4.2% | |
| Jun ’26 | 3.6% | 3.5% | |
| Jul ’26 | 3.6% | 3.3% | |
| Aug ’26 | 3.6% | 3.4% | |
| Sep ’26 | 3.9% | 3.7% | First increase since 2023 |
What worries officials is less the gap than how long inflation lasts. The minutes say many of them saw that the longer energy prices stayed high, “the greater the risk that cost increases in certain sectors could lead to broader price pressures.” Several also called the rate “not restrictive or only mildly restrictive,” meaning it does little to hold back spending.
The other side of the inflation story is the Fed’s own target measure. At the September 16 press conference Warsh said August PCE inflation “likely was around 3.6 percent,” with core about 3.2%. Those were the staff’s estimates under the Bureau of Economic Analysis’s new method, an annual update that changed how some prices, such as software and portfolio management fees, are measured.
BEA then published August PCE inflation at 3.4% and core PCE at 3.0%, about 0.2 point below those estimates. Prices further up the supply chain ran hotter, as the producer price index and our PPI breakdown show.
Show the data
| Inflation measure | Latest 12-month rate | Range midpoint minus inflation |
|---|---|---|
| CPI, all items (September) | 3.7% | about 0.2 point |
| CPI excluding food and energy (September) | 2.6% | about 1.3 points |
| PCE price index (August) | 3.4% | about 0.5 point |
| PCE excluding food and energy (August) | 3.0% | about 0.9 point |
| Producer prices, final demand (September) | 6.3% | not comparable |
Since July 2023 the range midpoint fell 1.5 points, from 5.375% to 3.875%, while 12-month CPI inflation rose about 0.4 point. The core PCE gap went from about 1.1 points to 0.9. On the old method the September minutes put August PCE inflation at 3.8% and core at 3.4%.
Source: BLS CPI and PPI for September 2026; BEA PCE for August 2026, published September 30; FRED CPIAUCSL and PCEPILFE for July 2023; Fed target range 3.75% to 4%, midpoint 3.875%; differences are our calculation.
How weak was hiring before the September Fed hike?
On today’s revised data, job growth in the year before September’s hike was the weakest before any Fed rate increase since 1994. In September itself, employers added only 29,000 jobs.
The September jobs report put unemployment at 4.2%, and it cut July and August by a combined 60,000 jobs. The minutes show the rate was 4.1% in July and August.
We lined up every Fed increase since February 1994, when the Fed first announced a rate increase on the day it made it. For each, we took 12-month payroll growth before the decision from today’s revised BLS payroll data on FRED. Before the 51 earlier increases it never fell below 1.15%. Before September’s hike it was 0.34%. The Fed saw earlier, unrevised numbers at each meeting, so this is a look back, and How we counted explains why it starts in 1994.
The comparison is not like for like in one way. Barr said lower immigration “has reduced the number of new jobs needed” to keep pace with the workforce, and the September statement said job gains “have kept pace with the workforce.” In our reading, that means 0.34% growth today signals less slack in the job market than the same pace would have in 2004.
In jobs, the year before the September hike added 543,000. The slowest earlier case, in June 2004, came after 1.5 million.
Show the data
| Item | Value |
|---|---|
| Feb 1994 | 2.56% |
| Mar 1994 | 2.49% |
| Apr 1994 | 2.95% |
| May 1994 | 2.98% |
| Aug 1994 | 3.20% |
| Nov 1994 | 3.33% |
| Feb 1995 | 3.47% |
| Mar 1997 | 2.47% |
| Jun 1999 | 2.36% |
| Aug 1999 | 2.54% |
| Nov 1999 | 2.54% |
| Feb 2000 | 2.59% |
| Mar 2000 | 2.34% |
| May 2000 | 2.56% |
| Jun 2004 | 1.15% |
| Aug 2004 | 1.28% |
| Sep 2004 | 1.37% |
| Nov 2004 | 1.53% |
| Dec 2004 | 1.55% |
| Feb 2005 | 1.55% |
| Mar 2005 | 1.69% |
| May 2005 | 1.60% |
| Jun 2005 | 1.51% |
| Aug 2005 | 1.86% |
| Sep 2005 | 1.94% |
| Nov 2005 | 1.67% |
| Dec 2005 | 1.88% |
| Jan 2006 | 1.91% |
| Mar 2006 | 2.03% |
| May 2006 | 2.01% |
| Jun 2006 | 1.91% |
| Dec 2015 | 1.94% |
| Dec 2016 | 1.66% |
| Mar 2017 | 1.70% |
| Jun 2017 | 1.72% |
| Dec 2017 | 1.51% |
| Mar 2018 | 1.51% |
| Jun 2018 | 1.61% |
| Sep 2018 | 1.60% |
| Dec 2018 | 1.52% |
| Mar 2022 | 5.19% |
| May 2022 | 4.87% |
| Jun 2022 | 4.73% |
| Jul 2022 | 4.48% |
| Sep 2022 | 4.11% |
| Nov 2022 | 3.61% |
| Dec 2022 | 3.36% |
| Feb 2023 | 3.18% |
| Mar 2023 | 2.81% |
| May 2023 | 2.47% |
| Jul 2023 | 2.31% |
| Sep 2026 hike | 0.34% |
Even people with jobs are losing ground to prices. Average hourly earnings rose 3.0% over the year to September, below the 3.7% rise in consumer prices. In our reading, that can weigh on spending, though it also keeps the inflation problem in front of officials.
Will the Fed raise, hold or cut rates on Wednesday?
Nobody outside the room knows before 2:00 p.m. In our reading, the Fed’s own record points toward another raise this year. The jobs data and the lower PCE figures give reasons to take time, and nothing the Fed published points to a cut.
A raise on Wednesday would rest on the September record set out above, plus the three voters who wanted a raise as early as July.
A hold would rest on timing, the point of Waller’s remark about consecutive meetings. Vice Chair Philip Jefferson said in an October 1 speech that officials would judge whether underlying trends bring inflation back to target, a judgment that “may take more time.” Weak hiring, the downward revisions and PCE inflation below the September estimates all fit that side. December also brings new projections.
Growth gives officials room either way. Real GDP grew at a 2.2% annual rate in the second quarter, after inflation, according to BEA’s third estimate. Its first estimate for July to September and September PCE inflation come out on Thursday morning, after the decision.
A cut would need officials to see the job market very differently from September, when the minutes said labor market risks “had diminished.” None of the 18 projections put the rate below today’s range at the end of 2026. Separately, Waller said that as of October 7, futures prices showed “an 85 percent chance of at least one hike by the end of the FOMC’s December meeting.” Those prices are the market’s bets on the rate.
How have mortgage rates moved since the September Fed hike?
Mortgage borrowing already costs more than at the September hike. The average long-term mortgage rate was 7.32% on October 22, against 6.95% on September 17, the day after the decision.
Both figures are the 30-year fixed rate in Freddie Mac’s weekly survey, as published on FRED. The 10-year Treasury yield was 5.00% on October 23, according to Federal Reserve H.15 data on FRED.
Those mortgage moves came with no second hike. In our reading, Wednesday’s decision matters to borrowers mostly through what it signals about December and next year, which is where the split between prices and jobs reaches them. Our report on September’s CPI covers what the price side means for household budgets.
What to watch
- Whether the Fed raises now or waits, and whether anyone dissents: the Fed statement at 2:00 p.m. ET on October 28, and Warsh’s press conference at 2:30 p.m.
- Whether inflation on the Fed’s target measure eases further, and how fast the economy grew from July to September: BEA’s September PCE release and first third-quarter GDP estimate, both 8:30 a.m. ET on October 29, per its release schedule.
- Whether hiring weakens further: the BLS jobs report for October on November 6.
- Whether energy keeps pushing consumer prices up: the BLS CPI report for October on November 10.
- How many officials still see a higher rate by year end: the new projections at the December 8-9 meeting.
How we counted
The gap between the Fed’s rate and inflation is the midpoint of the target range (3.875% for 3.75% to 4%) minus the latest 12-month rate of each measure as BLS and BEA published it. The chart and the July 2023 comparison use the 12-month change in seasonally adjusted CPI from FRED, which can differ from the published rate by about 0.1 point; October 2025 CPI was never published.
The payroll comparison covers all 52 increases since February 1994. Target changes come from FRED’s target series before December 2008 and the upper end of the range after it. Payrolls are total nonfarm, seasonally adjusted, today’s revised data, 12 months to the month before each decision. In March 1983, before the Fed announced its moves, it raised its target while payrolls were 1.8% below a year earlier, so the comparison starts in 1994, the first increase the Fed announced the day it made it. Chart labels give the month each increase took effect. Our methods follow the editorial policy.
Frequently asked questions
When does the Fed rate decision come out?
The Federal Reserve releases its statement at 2:00 p.m. ET on Wednesday, October 28, 2026, at the end of a two-day meeting. Chairman Kevin Warsh’s press conference follows at 2:30 p.m. ET, according to the Fed’s calendar.
What is the current Fed interest rate?
The federal funds target range is 3.75% to 4%, in place since September 17, 2026. The Fed raised it by a quarter point at its September 16 meeting, its first increase since July 2023.
Is there a new dot plot at the October Fed meeting?
No. The Fed publishes officials’ projections, including the rate chart known as the dot plot, four times a year. The next set comes with the December 8-9 meeting.
Will the Fed raise rates in December?
The September projections show 16 of 18 officials expecting at least one more quarter-point increase by the end of 2026, which leaves this meeting or December’s. The Fed has not said which, and the chair has said he does not give forward guidance.
Who voted at the last Fed meeting?
All 12 voters backed the September hike, including Chairman Kevin Warsh and Jerome Powell. Beth Hammack, Neel Kashkari and Lorie Logan, who had voted for a raise in July, joined them.
Sources
- StockTitan: Fed Hikes to 3.75%-4.00%, Signals One More Hike in 2026
- StockTitan: Fed Minutes, Another Hike Likely
- StockTitan: September 2026 CPI report
- StockTitan: September 2026 PPI
- Federal Reserve, FOMC statement, September 16, 2026
- Federal Reserve, implementation note, September 16, 2026
- Federal Reserve, FOMC minutes, September 15-16, 2026
- Federal Reserve, Summary of Economic Projections, September 2026
- Federal Reserve, press conference transcript, September 16, 2026
- Federal Reserve, FOMC meeting calendar
- Federal Reserve, October 2026 calendar
- Federal Reserve, FOMC statement, February 4, 1994
- Federal Reserve, Governor Waller speech, October 8, 2026
- Federal Reserve, Vice Chair Jefferson speech, October 1, 2026
- Federal Reserve, Governor Barr speech, September 29, 2026
- BLS, Consumer Price Index, September 2026
- BLS, Producer Price Indexes, September 2026
- BLS, The Employment Situation, September 2026
- BEA, PCE price index
- BEA, core PCE price index
- BEA, Gross Domestic Product
- BEA, release schedule
- FRED, federal funds target rate, 1982 to 2008
- FRED, federal funds target range, upper limit
- FRED, total nonfarm payrolls (BLS)
- FRED, consumer price index, seasonally adjusted (BLS)
- FRED, core PCE price index (BEA)
- FRED, 10-year Treasury yield
- FRED, 30-year mortgage rate (Freddie Mac survey)
The information provided in this article is for educational and informational purposes only. It does not constitute financial advice, investment recommendation, or an endorsement of any particular investment strategy. Past performance does not guarantee future results. Investors should conduct their own research and consult with a qualified financial advisor before making investment decisions.