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Federal Reserve hikes key rate for 1st time in 3 years, defying Trump demands for a cut

September 16, 2026

The quarter-point increase lifts the Federal Reserve's key rate to about 3.9% and, over time, could result in higher borrowing costs for mortgages, auto loans, and credit cards. In a set of quarterly projections, the Fed also signaled that its rate-setting committee expects to hike rates a second time later this year to 4.1%.

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