FED SEEN ON HOLD TONIGHT AS DANSKE EXPECTS 2–3 DISSENTS IN FAVOUR OF A HIKE

The Federal Reserve is widely expected to keep interest rates unchanged at its October meeting, although Danske Bank anticipates two to three FOMC members may dissent in favour of a hike. The bank expects further increases in December and March. Markets are also monitoring the Fed’s press conference, stronger-than-expected US consumer confidence at 91.7 and EUR/USD trading near its year-to-date lows.

28 Oct 20261 min read

Daily Market Update October 28, 2026

FED SEEN ON HOLD TONIGHT AS DANSKE EXPECTS 2–3 DISSENTS IN FAVOUR OF A HIKE

The Federal Reserve (Fed) is expected to leave interest rates unchanged at tonight’s policy meeting, in line with market consensus. Markets price a 10% probability of a rate hike, while Danske Bank expects two further increases, in December and March.

Most Federal Open Market Committee (FOMC) members have signalled that they can wait until December before raising rates again, although a few see greater urgency. Danske Bank expects two to three dissenting votes in favour of a hike.

According to Danske Bank, US consumer confidence rebounded in October. The Conference Board’s Consumer Confidence Index rose to 91.7, above the consensus forecast of 81.0 and the revised September reading of 84.2. Assessments of current conditions and future expectations both improved. Labour market perceptions also strengthened somewhat, although from weak levels, while inflation expectations declined but remained within their recent range.

According to Danske Bank, EUR/USD traded sharply lower on Tuesday, closing in on its year-to-date lows.

Danske Bank identifies this evening’s FOMC rate decision and the following press conference as the main event of the week.

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