Sunday long-read · Sunday, 1 November 2026
Two holds in two days, and both pointed at December
The Fed held with two hands up for a hike. The ECB held unanimously after debating one. Neither said yes; neither said no; both told you when they will look again.
Two central banks met this week, a day apart, and did the same thing in different ways. Both held. Both said energy is the problem. Both left December open. The difference is in who wanted to move now.
Wednesday, Washington. The Federal Open Market Committee kept its target range at 3.75% to 4% by a vote of 10 to 21. Governor Lisa Cook and Cleveland Fed President Beth Hammack voted against; both wanted a rise of a quarter point1. CNBC noted it was Cook’s first dissent since she joined in 20222. The statement said inflation “remains elevated” and that “the accumulation of more information” will guide the next step; it upgraded growth to “expanding at a strong pace”1. Inflation has been above the Fed’s 2% goal for more than five years2.
Thursday, Frankfurt. The ECB kept its deposit rate at 2.50%, the main refinancing rate at 2.65% and the marginal lending rate at 2.90%3. “Energy prices have continued to rise,” the Governing Council said, with upside risks for inflation and downside risks for growth3. Euro-area inflation was 3.8% in September6. Christine Lagarde said the Council “debated whether a hike was appropriate” and then decided unanimously to wait4. After the decision, money markets priced about a 67% chance of a December rise, according to LSEG data cited by CNBC4.
The second brake. The more interesting line was about bonds. Long-term borrowing has already become dearer: Lagarde said the average 10-year sovereign yield in the euro area had risen around 35 basis points since the previous meeting4. Reuters reported ECB estimates showing that rise would lower growth by a cumulative 100 basis points and inflation by 90 basis points in 2027–28, compared with the September baseline5. In plain words: the market has tightened for the ECB, and the ECB is counting it.
What it means at home. For your savings account and your mortgage offer, the policy rate did not move this week; the bond market did, and banks price long fixed-rate loans off the bond market. Read your next offer against that, not against the headline. Nothing here is investment advice.
The dull reassurance. Neither bank improvised. Each published a statement, held a press conference, recorded a vote and named what it will watch. “The interim meeting period will be information-rich,” Lagarde said5. That is a timetable, and a timetable is a kind of promise.
What to watch
A central bank that waits is not a central bank that has stopped. It is one that has scheduled its next reading.
Sources
- Federal Reserve issues FOMC statement — Board of Governors of the Federal Reserve System, 28 Oct 2026, 19:00 CET.
- Fed holds rates steady despite concerns over inflation — CNBC, 28 Oct 2026, 20:43 CET.
- Monetary policy decisions, October 2026 — National Bank of Belgium (ECB press release), 29 Oct 2026, 14:15 CET.
- European Central Bank keeps key interest rate on hold at 2.5% — CNBC, 29 Oct 2026.
- ECB flags December hike but sees yield rise hitting growth — Reuters via Euronext, 29 Oct 2026, 20:24 CET.
- Annual inflation up to 3.8% in the euro area — Eurostat, 16 Oct 2026.
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