Fed Rate Tracker: 3.75%–4.00%

The Fed’s latest decision

On September 16, 2026, the Federal Open Market Committee voted 12–0 to raise the target range for the federal funds rate by a quarter point to 3.75%–4.00%, its first increase since July 2023. The statement said inflation "remains elevated" and that the move would support "a timelier return" to the Fed’s 2% goal. The Fed also raised the interest rate it pays on reserve balances to 3.90%, effective September 17.

Major banks lifted the prime rate from 6.75% to 7.00% the next day. The prime rate usually sits three points above the top of the Fed’s range, and it is the benchmark for most credit card APRs and home equity lines of credit.

Why the Fed raised rates in September 2026

The September 16 statement described an economy running hot enough to justify tighter policy. In the Committee’s words, "economic activity is expanding at a solid pace," domestic spending "has been resilient," and "job gains have kept pace with the workforce, and the unemployment rate has changed little."

The deciding factor was prices. "Inflation remains elevated," the statement said, and the hike would "support a timelier return" to the Fed’s 2% goal. The move followed five meetings without a change in 2026; at the July meeting, three members had already dissented in favor of a quarter-point increase.

For borrowers, the message is that the period of falling rates that ran from September 2024 to December 2025 is over for now. Variable-rate debt is getting more expensive, while fixed-rate loans taken out earlier keep their rates.

What the federal funds rate is

The federal funds rate is the interest rate banks charge each other for overnight loans of reserves. The Federal Open Market Committee, which meets eight times a year, sets a target range for it, a quarter of a percentage point wide. The Fed then uses tools such as the interest it pays on reserve balances to keep the market rate inside that range.

Banks pass the change on through the prime rate, the rate they publish for their most creditworthy customers. By long-standing convention it sits three points above the top of the Fed’s range, which is why prime moved from 6.75% to 7.00% the day after the September hike. Most credit cards set their APR as prime plus a margin, so card rates follow almost automatically.

Fixed-rate consumer loans are priced differently. Lenders set them from their own funding costs, expected losses and competition, so a single Fed move shows up slowly, if at all, in personal loan offers.

How to read a Fed decision

Each FOMC statement is released at 2:00 p.m. Eastern Time on the last day of the meeting. Look for three things: the target range itself, the vote count, and any dissents. A unanimous vote, like September’s 12–0, signals broad agreement. Dissents, like the three in July that favored a hike, often hint at where policy is heading next. At four meetings a year, the Fed also publishes a Summary of Economic Projections showing where officials expect rates to go.

Fed funds and prime rate since 2024

Over this period the Fed cut by a total of 1.75 points, from 5.25–5.50% to 3.50–3.75%, then reversed course with a quarter-point hike. The prime rate followed each move one-for-one, from 8.50% down to 6.75% and back up to 7.00%.

Every Fed decision since 2024

Each date links to the official FOMC statement. "bp" means basis points; 25 bp is a quarter of a percentage point.

How a Fed move reaches your loans

The Fed does not set consumer loan rates. It sets the overnight rate banks charge one another, and that cost flows into consumer credit at different speeds.

The Fed’s own data shows the lag. The average 24-month bank personal loan rate was 11.63% in late 2025, 11.36% in early 2026 and 11.90% in August 2026, a narrow band despite 1.75 points of cuts in the prior two years. Card APRs on accounts charged interest were 22.36% in August 2026.

What a quarter point costs you

• On a $5,000 card balance, a 0.25-point rise adds about $12.50 a year in interest, or roughly $1.04 a month.
• On a new $5,000, 36-month personal loan, a rate of 25.24% instead of 24.99% raises the payment from $198.77 to $199.43, about $23.82 over the life of the loan.

A single hike is small. What adds up is carrying a variable-rate balance through several moves, which is why paying down card debt is usually the best response to a rising-rate cycle.

What to do before and after a Fed decision

1. Pay down variable-rate balances first. Credit cards and HELOCs reprice with prime. Every dollar you pay off stops the next increase from applying to it.
2. Lock a fixed rate if you are borrowing anyway. A fixed-rate personal loan keeps the same payment for its whole term, whatever the Fed does next.
3. Don’t try to time the market. FOMC decisions are hard to predict, and a few weeks’ difference rarely changes a personal loan offer much. Your credit score matters far more.
4. Compare offers, not headlines. Two lenders can price the same borrower several points apart. Check the APR and total cost on each.

Upcoming dates

We update this page after each decision. The Fed publishes minutes of each meeting three weeks later; minutes of the October meeting are scheduled for November 18.