In brief
The Federal Reserve held its core policy rate steady at 3.75%–4.00% on October 28, voting 10‑2 to pause amid midterm election concerns. The decision lifted U.S. shares and supported South Korean markets, while Fed Chair Kevin Warsh warned that inflation remains too high and future hikes could follow. Analysts see the pause as a token of caution before potential year‑end increases.
On Oct. 28 the U.S. Federal Reserve kept its benchmark interest rate at the 3.75%–4.00% range, a 10‑2 vote that came one week before the 2026 midterm elections, according to Xinhua and Yonhap reports.
The Fed said economic activity is expanding strongly, jobs are steady, and productivity continues to rise, but inflation is still above the 2% goal for which the central bank is charged.
Of the 12 members of the Federal Open Market Committee, 10 voted to hold the rate while two favored an additional increase, as noted in the Fed's official statement.
U.S. equity markets ended higher after the decision, with the Dow Industrial Average up 97.53 points, the S&P 500 gaining 21.38 points, and the Nasdaq Composite adding 72.04 points. Most S&P 500 sectors closed in the green, though utilities and real estate lagged.
In Seoul, the Korea Composite Stock Price Index edged up 0.17% as investors reacted to the Fed pause and anticipated strong earnings from Samsung Electronics.
Fed Chair Kevin Warsh said inflation remains “too high” and that the committee may raise rates again later in the year, adding that “full adjustment to normal policy levels is still a work in progress.”
“Energy and related prices have moved higher again in recent weeks, and our job is to ensure that relative price changes in some sectors do not broaden out across the economy,” Warsh told a press briefing. “It’s our responsibility to get inflation down.”
Warsh also noted that the FOMC will review additional data before the next policy meeting, indicating that further rate hikes could come if inflationary pressures do not ease. Analysts expect the October pause to set the stage for a possible year‑end increase.
