So Money with Farnoosh Torabi · Friday, September 18, 2026
The Federal Reserve announced its first interest rate increase in over three years, raising the benchmark federal funds rate by a quarter of a percentage point to a target range of 3.75% to 4%. This move is intended to combat persistent inflation, which the Fed aims to bring back toward its 2% goal.
“On Wednesday, the Fed voted unanimously to increase its benchmark federal funds rate by a quarter of a percentage point, bringing its target range to three and three quarters percent to four percent.”
“And this is significant because it is the first Fed rate increase in three years since 2023.”
“Why? Because the Fed said inflation remains elevated. And that the increase is intended to help bring inflation back toward its 2% goal.”