The Federal Reserve held its benchmark rate steady on Oct. 28, voting 10-2 to keep the federal funds target range at 3-3/4 to 4 percent, according to the Fed’s statement. Lisa D. Cook and Beth M. Hammack cast the two dissenting votes, both preferring to raise the range by a quarter of a percentage point. The bank prime rate, the base that variable credit card rates follow, stood at 7.00% on Oct. 29, the Fed’s H.15 data shows.
Prime was 7.00% on every day the Fed lists from Oct. 23 through Oct. 29, and the effective federal funds rate sat at 3.88% throughout. The Fed notes that prime is posted by a majority of the top 25 U.S.-chartered commercial banks. The last change in the range was a quarter-point increase on Sept. 16 to 3.75% to 4.00%, on a 12-0 vote, PrimeRates.com reports, and prime has stayed at 7.00% since.
Whether a hold matters to a household depends on which side of the rate the money sits. A variable card APR follows an index such as prime, while a savings account pays whatever the bank chooses. People carrying a balance can find out how their card moves in the cardholder agreement, which, the Consumer Financial Protection Bureau says, “will say how a card’s APR can change over time.” Anyone holding cash can compare the yield on a statement with the Fed’s range.
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What did the Fed’s October statement say?
The statement describes an economy “expanding at a strong pace,” with resilient spending, strong productivity growth and robust capital investment. On jobs, it says “Job gains have kept pace with the workforce, and the unemployment rate has changed little.” On prices, the wording is blunt: “Inflation remains elevated.”
The Committee wrote that more information will help it set a policy stance for “a timely return of inflation to the Committee’s 2 percent goal,” and it closed with the sentence “The Committee will deliver price stability.” The statement also describes the Fed’s approach as maintaining ample reserves in the banking system. It does not hint at the size or timing of any next move.
Why did two members want a hike?
The statement gives no separate explanation for Cook and Hammack, but the pattern is plain from the votes. The September increase passed 12-0, and in October two members preferred another quarter-point increase while ten voted to hold. A unanimous move followed by a split decision is the kind of change that gets watched closely before the next meeting.
The Fed’s 2026 calendar lists that meeting for Dec. 8 and 9, the last of the year and one of those paired with a Summary of Economic Projections. The calendar adds that each meeting date is tentative until confirmed at the meeting before it. Nothing in the October release commits the Committee to any direction.
Where do credit card rates stand now?
The Fed’s G.19 report puts the average card rate at 21.19% across all accounts and 22.36% on accounts assessed interest for August, a preliminary figure released Oct. 7. For the second quarter, revised, the averages were 20.94% and 22.15%. In the third quarter of 2025 they were 21.39% and 22.83%.
Those are national averages, and an individual card can sit well away from them. A fixed APR, the CFPB says, “does not fluctuate with changes to an index,” so a fixed-rate card behaves differently from one tied to prime. A hold means the index behind variable cards did not rise this month. It also means it did not fall, so a balance costs the same to carry as it did before the meeting.
What does a steady 3-3/4 to 4 percent mean for cash?
The same range sets the backdrop for savers. With the effective federal funds rate at 3.88% and inflation described by the Fed as elevated, an account paying close to nothing is falling behind on both measures. Savings and certificate yields at banks are set by each bank, so the range is a benchmark for comparison and not a promise of what an account will pay.
The practical check takes about five minutes: find the rate printed on the latest statement, then look at how much of the balance is needed in the next year and how much can sit longer. The first pile belongs somewhere liquid and insured, and the second can be matched to a date.
Does your savings account pay anything close to the Fed’s 3-3/4 to 4 percent range?
With the range holding at 3-3/4 to 4 percent and inflation still elevated, cash in an account that pays next to nothing loses ground every month the Fed stays put. A hold in October leaves the same math in place until the Dec. 8 and 9 meeting.
Make Your Savings Pay You is an 11-page guide to insured high-yield savings, CDs, Treasury bills and I bonds. It shows how to keep every dollar insured, even above $250,000 at one bank, and walks through Treasury bills from $100, free of state and local income tax, plus a ladder that can be copied.
This article was produced with AI assistance and edited for accuracy against the sources linked above.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
