Federal Reserve to Raise Interest Rates in December 2026
Economists project the federal funds rate will climb to between 4.00% and 4.25% by the end of 2026.
Updated on Oct. 20, 2026 in Economic Indicators
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A survey of 100 economists indicates that the Federal Reserve is expected to implement an interest rate increase in December 2026. Projections suggest the federal funds rate will reach a target range of 4.00% to 4.25% by year-end.
Why it matters
The consensus among economists highlights a shift in sentiment regarding long-term monetary policy. Tracking these expectations provides insight into how financial experts anticipate the central bank will balance economic growth against inflation pressures.
A survey conducted in October 2026 shows 94 of 100 economists expect the federal funds rate to reach 4.00% to 4.25% by year-end. This is a significant increase from September 2026, when only 29 of 76 economists anticipated this range.
The players
Federal Reserve
The central bank of the United States manages the nation's monetary policy and oversees the federal funds rate.
The details
The latest forecast reflects a growing agreement among analysts regarding the trajectory of federal interest rates as the year concludes. This consensus represents a notable shift from the outlook held by market observers just one month prior.
Timeline
September 2026 saw 29 of 76 surveyed economists predict the specific rate range.
The survey of 100 economists was conducted in October 2026.
The Federal Reserve is expected to implement an interest rate increase in December 2026.
Macro View
These projections reflect the current consensus regarding the Federal Reserve's federal funds rate target as it navigates the 2026 economic cycle. This outlook follows historical patterns where central bank policy adjustments are signaled well in advance to manage market expectations.
Changes to the federal funds rate directly influence the interest rates consumers pay on mortgages, credit cards, and auto loans. An upward trend in these rates generally increases the cost of borrowing for households across the country.
The takeaway
The upward shift in interest rate forecasts suggests that borrowing costs may remain elevated as the year concludes. Readers should prepare for potential impacts on personal loan rates and savings account yields influenced by central bank policy.
Further reading
For more on the national outlook, visit United States Economic Indicators.
Live Poll
Do you expect higher interest rates to help or hurt your personal finances next year?
