Federal Reserve holds interest rates steady in first policy meeting of 2026

Two officials dissented, voting for a 0.25% rate cut

Jan. 28, 2026 at 2:07pm

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The Federal Reserve kept interest rates unchanged in a range of 3.5%-3.75% in its first meeting of the year, as widely expected. Two Federal Open Market Committee officials, Governors Stephen Miran and Chris Waller, dissented and voted to cut rates by 0.25%. The central bank upgraded its assessment of the US economy, saying it was expanding at a "solid" pace, and removed a reference to job-market risks.

Why it matters

The Fed's decision to hold rates steady comes as divisions over the path for inflation and the labor market have dominated recent FOMC meetings. The central bank is now watching both sides of its dual mandate - employment and inflation - equally closely as it navigates the economic outlook.

The details

In its statement, the Fed said the US economy expanded at a "solid" pace last year and is coming into 2026 on a firm footing, while job gains have remained low and inflation remains somewhat elevated. The central bank removed a reference to job-market risks, a signal it is watching both sides of its dual mandate equally.

  • The Federal Reserve held its first policy meeting of 2026 on January 27-28.

The players

Federal Reserve

The central banking system of the United States that conducts monetary policy, supervises banks, maintains financial system stability, and provides banking services.

Stephen Miran

Federal Reserve Governor who joined the Board in September 2025 and voted for a 0.25% rate cut in the January 2026 meeting.

Chris Waller

Federal Reserve Governor who voted for a 0.25% rate cut in the January 2026 meeting.

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What they’re saying

“The US economy expanded at a solid pace last year and is coming into 2026 on a firm footing, while job gains have remained low, the unemployment rate has shown some signs of stabilization, and inflation remains somewhat elevated in support of our goals.”

— Jerome Powell, Federal Reserve Chair (Federal Reserve)

The takeaway

The Fed's decision to hold rates steady reflects its view that the economy is on firm footing, even as divisions remain within the central bank over the appropriate policy path. The central bank will continue to closely monitor labor market and inflation developments as it navigates the economic outlook in 2026.