Federal Reserve Holds Rates, Treasury Yields Increase Amid Future Hike Expectations

The Federal Reserve maintained its federal funds rate at 3.75%-4.00% on October 28, 2026, with markets now anticipating two further rate hikes in early 2027. This outlook led to a sell-off in longer-dated Treasuries, pushing the 10-year yield to 5.02% and the 2-year yield to 4.70%. The decision aims to gather more data to guide inflation back to the 2% target.