On September 16, 2026 the Federal Open Market Committee voted 12–0 to raise the target range for the federal funds rate by a quarter of a percentage point, to 3.75%–4%.
In its statement the Committee described economic activity as expanding at a solid pace, with resilient spending, strong productivity and robust capital investment, and said inflation remains elevated. It said the increase is meant to support a timelier return to its 2 percent inflation goal.
- Many bank lines of credit and some SBA 7(a) loans carry variable rates tied to the prime rate, which usually moves with the federal funds rate.
- Fixed-rate loans you have already signed do not change.
- Merchant cash advances and factoring are priced with a fixed fee, not a rate that follows the Fed, so their cost does not move with this decision.
What it means for you: If you carry a variable-rate line of credit or loan, check your statement for the new rate and budget for a slightly higher payment.
Source: Federal Reserve Board, FOMC statement, September 16, 2026. Summary written by us; the official source governs. General information, not financial, legal or tax advice.