Good morning. Since 2024 the Federal Reserve has moved its benchmark rate six times, and every one of those moves was down. The seventh went the other way.
Top story — The Fed raised rates, and the projections published alongside the decision moved further than the decision did
At its September meeting the Federal Open Market Committee, by a 12 – 0 vote, “decided to raise the target range for the federal funds rate by 1/4 percentage point to 3-3/4 to 4 percent, in support of the Federal Reserve’s dual mandate.” The new range is 3.75% to 4%.
It is the first increase in more than three years, and that is checkable rather than assertable. The Board publishes its own table of every change to the target, and the last row marked Increase before this one is July 27, 2023, which took the range to 5.25%–5.50%. The six changes in between — three in 2024, three in 2025 — are every one of them marked Decrease. Three years and fifty-two days.
And here is the detail worth a second look. The range the Committee just set, 3.75%–4%, is the same range it set on October 30, 2025. The cut it made on December 11, 2025 has been undone. On the Fed’s own published numbers, that leg was a round trip.
The reason given is one line: ”Inflation remains elevated.” The Committee said the move “will support a timelier return to the Committee’s 2 percent goal.” It then closed with one more sentence: ”The Committee will deliver price stability.”
But the number that matters most for planning is not the one in the headline. Four times in 2026 the Committee publishes what each participant thinks the appropriate rate path is. In the projections released with this decision, the median projection for the federal funds rate at the end of 2027 is 4.1%. In the June projections, the same median was 3.6%. For 2028 it moved from 3.4% to 3.9%.
Half a percentage point, added to two future years, between one projection round and the next.
Two cautions the Fed itself attaches, and this issue prints both. These are projections by individual participants, not a Committee plan and not a promise — the document says so. And the figure is the midpoint of a target range, not a rate anyone is charged. But the numbers are the Fed’s, not ours: in June the median projection for the end of 2027 was 3.6%, and in September it was 4.1%.
If your plan for the next truck, the next hire, or refinancing an equipment note assumed money keeps getting cheaper, it is now out of step with the Fed’s own updated numbers.
Quick hits
Prime is the number to watch, and the Fed publishes it. The Board’s H.15 release shows the bank prime loan rate at 6.75% on every business day from September 9 through September 15, 2026 — the last data day before the decision. Prime is conventionally set three percentage points above the top of the federal funds target range, which would put it at 7% on the new range. That last step is arithmetic on a market convention, not a figure quoted from any document cited here, and H.15 had not published a post-decision day when this was written. Check the printed number before you argue about a payment. H.15 defines the series as the rate “posted by a majority of top 25 (by assets in domestic offices) insured U.S.-chartered commercial banks” — it is what sits under most business lines of credit, variable equipment notes and business credit cards, and those reprice on their own.
Long-term yields were already climbing before the Fed did anything. H.15 shows the 10-year Treasury constant maturity going from 4.83% on September 9 to 5.00% on September 15 — seventeen basis points across five business days, all of it before the meeting. The 30-year went 5.28% to 5.36%. The Fed sets the short rate; these are a different market moving on its own, and it was moving the same way.
A quarter point on what you carry. On a $150,000 floating balance across a line of credit and equipment notes, a 0.25-point rise is about $375 a year. Small on one loan. Real across everything you carry.
The statement never mentions housing, construction or mortgages. It describes an economy in which “Economic activity is expanding at a solid pace,” “Productivity growth is strong, and capital investment is robust,” and “Job gains have kept pace with the workforce, and the unemployment rate has changed little.” On its own reading, the Fed is not raising rates into a weak economy.
The Tip — find every dollar you borrow that floats, and price the swap
Pull your debt schedule and mark every facility that reprices off prime: the business line of credit, variable equipment and truck notes, floor-plan financing, and business credit cards. If prime has moved, those payments repriced when it did, and nothing needed your signature — you may get no notice at all. Call your banker with two questions, in this order: what is my rate today, and what would it cost to fix the balances I will still be carrying in two years? The second question is the one the projections just changed — the choice is no longer between fixing now and fixing cheaper later, it is against a published median that went up half a point.
Then check the sell side. If you advertise financed work at “as low as $X a month” and your finance partner’s rate floats, your flyer may be quoting a payment you can no longer deliver. Reprice it before a customer holds you to it.
Tool watch — [Not sponsored]
Don’t take a headline’s word for the rate your loans reset to — the Fed publishes both numbers itself, free, no login. H.15 Selected Interest Rates (federalreserve.gov/releases/h15) is posted Monday to Friday and carries the bank prime loan rate and the 10-year Treasury on the same page. And the Board’s Open Market Operations page (federalreserve.gov/monetarypolicy/openmarket.htm) is a single plain table of every change to the target rate back to 2003, each one marked Increase or Decrease, with earlier years in a linked archive — which is how the “first rise since 2023” line in this issue was checked rather than repeated. Both are government-run and neither sells anything.
That’s the callout. See you next time.
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Sources: FOMC statement, 16 September 2026 (Federal Reserve) · FOMC’s target federal funds rate or range, change and level (Federal Reserve) · Summary of Economic Projections, 16 September 2026 (Federal Reserve) · H.15 Selected Interest Rates, release of 16 September 2026 (Federal Reserve) · FOMC meeting calendar (Federal Reserve) — all at federalreserve.gov.