USDIDX: Fed Decision, October 28, 2026

The FOMC announces its decision on Wednesday, October 28 at 2:00 PM ET, with the press conference at 2:30 PM ET.

The rate sits at 3.75 – 4.00% after September hike. We are going to pay attention to Warsh’s statement and tone.

Most probable outcome is of course is hold with a hawkish bias.

At the beginning of October, futures priced an 80% chance of holding rates steady and 20% for a hike in October, with a December hike probability around 81%. Last week, Warsh didn’t give any clarification on this month's decision but stated that higher inflation had not changed his forecast.

Therefore, the Fed is likely to keep rates unchanged, leaving December open, in line with September forecasts pointing to another 25 basis point hike in 2026.

USDIDX

Since hold is already priced in, decision itself won’t move the dollar much. The index rallied from roughly 98.5 to about 101 on hike expectations and a hawkish hold simply keeps that support in place. I’d expect a modest bounce and then consolidation. Oil is near $105, which adds to the inflation and gives the dollar some haven demand (little).

If Warsh remains firm on his inflation position, buying on the dip at the recent support level will look more profitable, with 101 becoming the first target.

Softer rhetoric in December could push the index down to the 99 – 99.50 range, which is highly unlikely.