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NewsWPLG Local 10 – Main FeedSeptember 15, 2026Miami-Dade County

Federal Reserve expected to raise benchmark interest rate to combat inflation

Photo: WPLG Local 10 – Main Feed

The Federal Reserve is widely expected to raise its short-term interest rate to fight persistent inflation, despite demands from President Donald Trump for a rate cut ahead of the midterms. Financial markets price in a high probability of a rate hike following recent inflation reports and signals from Fed Chair Kevin Warsh.

Federal ReserveInterest RatesInflationEconomyMonetary Policy
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Why It Matters

A change in the Federal Reserve's benchmark interest rate influences broader borrowing costs for consumers and businesses, including mortgages, auto loans, and yields on .

Key Facts

  • The Federal Reserve is widely expected to lift its short-term interest rate Wednesday for the first time in three years.
  • The current benchmark rate is about 3.6%.
  • President Donald Trump has publicly demanded that the Fed cut rates instead of raising them.
  • Traders see a 90% chance of a rate hike on Wednesday according to futures prices.
  • The potential rate hike comes seven weeks before the midterm elections.
  • Recent inflation reports showed prices remain stubbornly high and core inflation picked up in August.
  • The Fed's target for inflation is 2%.
  • Surging investment in AI data centers has contributed to higher longer-term interest rates and inflation pressures.
  • Wall Street traders expect three total hikes in September, December, and March.

Who's Mentioned

OrganizationJPMorgan Chase“Financial services firm”PersonMichael Feroli“Economist at JPMorgan Chase”locationJackson Hole“Site of the Fed's annual conference in Wyoming”locationIran“Location of a war affecting oil and gas prices”OrganizationFederal Reserve“Central bank of the United States”PersonJerome Powell“Former Fed Chair”PersonDonald Trump“President of the United States supporting an interest rate cut”OrganizationDeutsche Bank“Financial institution”PersonMatthew Luzzetti“Chief U.S. economist at Deutsche Bank”PersonKevin Hassett“Trump's top economic adviser”PersonKristin Forbes“Economist at MIT's Sloan School”PersonKevin Warsh“Fed Chair”