The Fed Held Rates at 3.75% to 4% on Oct. 28, but Two Officials Wanted a Hike: What It Means for Your Credit Card APR

Your card's interest rate probably won't change because of today's decision. But the split vote is a reminder that rates could still move higher, and the payment you choose matters far more than the Fed.

Did the Fed change interest rates on Oct. 28?

No. The Federal Reserve kept its benchmark federal funds rate in a range of 3.75% to 4% on Wednesday, Oct. 28. The vote was 10-2. Two officials, Governor Lisa Cook and Cleveland Fed President Beth Hammack, wanted to raise the rate by a quarter of a percentage point, a sign some policymakers still see inflation as a problem.

The decision was announced at 2 p.m. Eastern time (11 a.m. Pacific) in the Fed's official statement. The federal funds rate is what banks charge each other for overnight loans. You never pay it directly, but it sets the tone for the rates on credit cards, home equity lines and many other loans.

Today's hold follows a hike last month. On Sept. 16, the Fed raised the range by a quarter point to where it sits now, in a unanimous vote. Yahoo Finance described that move as the Fed's first increase in more than three years, and reported that today's dissent was the first ever for Cook.

Why did the Fed hold, and why did two officials want a hike?

The Fed's statement said economic activity is expanding strongly, spending has held up despite uncertainty tied partly to world events, and job gains have kept pace with growth in the workforce. It also said plainly that "inflation remains elevated." Rather than raise rates again right away, the committee said gathering more information will help it decide what is needed to bring inflation back to its 2% goal.

Recent price data explains the debate. Consumer prices rose 3.7% in the year through September, up from 3.4% in August, according to figures cited by Yahoo Finance. The two dissenters preferred to act now. The rest of the committee chose to wait.

The Fed has one more scheduled meeting this year, on Dec. 8 and 9, according to its meeting calendar. Nobody knows yet what it will decide, and outside forecasts are not promises.

How does the Fed's decision reach your credit card?

Most credit cards have a variable APR, which is your annual interest rate. It is usually built from two parts: an index, most often the U.S. prime rate, plus a margin your card issuer sets based on your credit and the card. The prime rate generally moves with the federal funds rate. When the Fed raised rates in September, big banks lifted their prime rate from 6.75% to 7% the next day.

Because the Fed held today, there is no new reason for the prime rate to move, so most variable card APRs should stay where they are for now. The Consumer Financial Protection Bureau explains that a card's rate can rise on your existing balance when the index it is tied to, such as the prime rate, goes up. Other increases generally require 45 days' notice and apply to new purchases.

Card rates are already high. The Fed's own data shows the average APR on credit card accounts that were charged interest was 22.36% in August 2026, a preliminary figure, according to its consumer credit report. Americans carried about $1.35 trillion in revolving credit, which is mostly credit card debt, in August.

What this means for your wallet

If you pay your card in full every month, today's decision does not change what you owe, because you aren't paying interest. If you carry a balance, here is how the math works.

Take a $6,000 balance at 22.36% APR. Interest adds about $112 a month. If you pay $250 a month and stop using the card, it would take about 33 months to pay off and cost roughly $2,027 in interest. If rates rose another quarter point and your APR went to 22.61%, that same plan would cost about $2,061, only around $34 more over the whole payoff.

Now change the payment instead. At 22.36%, paying $350 a month clears the balance in about 21 months with roughly $1,296 in interest. That one choice saves about $731 and a full year, far more than any quarter-point Fed move would cost or save.

Some ways people with card debt use a moment like this:

• Check your current APR. It's on your statement. Knowing the exact rate helps you rank which card to pay first, a method our debt snowball vs. debt avalanche guide explains.
• Ask your issuer for a lower rate. A phone call costs nothing, though there's no guarantee the issuer will say yes.
• Compare a balance transfer. A 0% introductory offer can pause interest for a set period, though fees apply. Our balance transfer explainer covers the fine print.
• Learn how interest is calculated. Our guide to credit card APRs and grace periods shows how daily interest adds up.

The CFPB also notes that if your rate rose because you paid more than 60 days late, your issuer must restore your old rate after six on-time minimum payments in a row.