LemonTrades
TL;DR
- Not soon, if the Fed is right. It raised its rate to 3.75–4.00% on September 16, and most officials expect one more hike this year and no cut in 2027.
- The Fed’s median projection doesn’t show a cut until 2028, to about 3.9%.
- For rates to fall sooner, inflation (3.7%) would need to drop fast, or unemployment would need to jump.
- LemonTrades warns you before every Fed decision and tells you what it did to gold, the dollar and stocks the minute it’s out.
After cutting six times from September 2024 to December 2025, the Federal Reserve held for most of 2026, then raised rates in September as inflation picked up. Here’s where rates are likely to go, and when they could finally come down.
The short answer
The Fed’s own forecast says rates go up before they go down. In September, the median official saw the rate at 4.1% at the end of 2026, which means one more quarter-point hike, then no change in 2027 and a single cut in 2028. Chair Kevin Warsh said the summer’s inflation readings didn’t show “that underlying trends have meaningfully improved.” Those projections aren’t promises; they change every quarter.
How we got here
| Period | What the Fed did | Rate after |
|---|---|---|
| Sep to Dec 2024 | Three cuts, 1 point in all | 4.25–4.50% |
| Sep to Dec 2025 | Three quarter-point cuts | 3.50–3.75% |
| Jan to Jul 2026 | Held at five meetings | 3.50–3.75% |
| Sep 16, 2026 | Raised a quarter point, 12 votes to 0 | 3.75–4.00% |
The next decisions
The next meeting ends on October 28, with the decision at 2:00 PM ET; prediction markets on October 20 put a hold at about 86% and another hike at about 13%. After that comes December 8–9, with new projections. Dates and live odds links are on when is the next Fed meeting.
What would bring rates down
- Inflation falling toward 2%. Consumer prices rose 3.7% in the year to September, and the Fed expects its preferred PCE gauge to end 2026 at 3.7%. See the CPI report explained.
- A weaker job market. Unemployment is 4.2%. A sharp rise would push the Fed to cut. See the unemployment and jobs report.
- A recession or a market crisis. The Fed cut fast in 2001, 2008 and 2020. See is America in a recession?
- Lower oil prices. Oil near $100 keeps inflation up. See the oil price.
What it means for your rates
- Mortgages track the 10-year Treasury yield more than the Fed. With that yield above 5%, 30-year mortgage rates have stayed high even in months the Fed didn’t move. See the 10-year Treasury yield.
- Credit cards and home equity lines follow the prime rate, which moves with the Fed: 7.00% now.
- Savings accounts and CDs pay more when the Fed raises rates, so savers gain for now.
- Gold tends to struggle when rates rise, because it pays no interest. See why gold drops.
Sources
- Federal Reserve: FOMC meeting calendars, statements and projections
- CME FedWatch: rate odds
- BLS: Consumer Price Index
Education, not financial advice. Rates and projections as of October 22, 2026. See our disclaimer.
