Fed Holds Rates as Trump-Targeted Lisa Cook Casts First-Ever Dissent

The Federal Reserve kept interest rates on hold Wednesday, but the vote was not unanimous, and one of the two officials who broke with the majority was Governor Lisa Cook, the Fed governor President Donald Trump has been trying to fire.

The Federal Open Market Committee voted 10-2 to keep the federal funds rate in a target range of 3.75% to 4%, according to the Fed’s official statement. The statement said Cook and Cleveland Fed President Beth Hammack “preferred to raise the target range for the federal funds rate by 1/4 percentage point at this meeting.”

BREAKING: The Federal Reserve holds interest rates steady at 3.75% to 4%, just six days before the midterm elections, as inflation continues to weigh on the U.S. economy.

Fed policymakers voted 10-2 to keep rates unchanged after raising them by 25 basis points in September, the… pic.twitter.com/IkkSFacaTM

— Fox News (@FoxNews) October 28, 2026

NBC News reported that Wednesday’s dissent was Cook’s first ever, and noted that September’s decision to raise rates had passed 12 to 0. Politico likewise reported that Cook had not previously dissented from a monetary policy decision.

What the Fed said

“Inflation remains elevated,” the committee said in its statement. “The accumulation of more information will help the Committee determine the policy stance appropriate to ensure a timely return of inflation to the Committee’s 2 percent goal. The Committee will deliver price stability.”

The statement painted a strong picture of the broader economy. “Economic activity is expanding at a strong pace,” the committee said, adding that domestic spending “has been resilient,” productivity growth “is strong” and capital investment “is robust.” The Fed also said job gains “have kept pace with the workforce, and the unemployment rate has changed little.”

The Associated Press reported that the Fed, led by Chairman Kevin Warsh, gave little hint about its next move. NBC News reported that the Fed’s acknowledgment that inflation remains well above its goal set the stage for a possible rate increase at the December meeting.

Prices still the pressure point

NBC News reported that inflation rose from 3.4% in August to 3.7% in September, and that the soaring cost of gas, diesel and crude oil has been a major driver. Politico reported that inflation remains well above 3% and has been pushed higher by oil prices and robust consumer spending.

The Fed’s preferred inflation gauge, the personal consumption expenditures index, will be released Thursday and is expected to show 3.7%, according to NBC News.

NBC News called Wednesday’s announcement the Fed’s final monetary policy decision before the Nov. 3 midterm elections. A rate increase, the network noted, could have added more pressure on consumers already dealing with higher prices.

The Cook fight

Cook’s vote comes as the Trump administration presses its effort to remove her from the Fed’s board. NBC News and Politico both described Cook as the governor Trump has tried to fire. Cook has fought the effort, and her case remains unresolved.

The split also raises a pointed question heading into the final week before Election Day: whether the Fed’s internal divisions over how hard to fight inflation will spill into the political debate over the cost of living. Wednesday’s two dissenters wanted borrowing costs to go higher, according to the Fed’s statement.

Warsh was scheduled to answer questions from reporters at a press conference following the decision.

Sources

• Federal Reserve: FOMC statement, Oct. 28, 2026
• NBC News: Fed keeps interest rates steady despite rising inflation
• AP: Federal Reserve keeps rates unchanged despite elevated inflation
• Politico: Trump-targeted Lisa Cook dissents as Fed puts rates on hold
• Fox News on X

Reporting by Daily Beltway.