The Federal Reserve will reduce how often it votes on interest rates, while still holding eight meetings a year. From autumn 2027 it will set policy at seven meetings rather than eight, and in 2028 at six, ending a pattern in place since 1981 under the Federal Open Market Committee (FOMC). One meeting will be reserved for long-term strategy, with no rate decision and no statement; the change was announced in October and requires no outside approval because the law mandates only four meetings annually. One forecaster expects October 2027 to be the first non-voting gathering, creating a 12-week stretch from 15 September to 8 December, during which two monthly inflation reports would land instead of one.
Potential Market Impacts of Fewer Decision Days
Fewer decision days concentrate information, potentially increasing moves in the policy path implied by futures and in the two-year Treasury yield. A 12-week gap is estimated to carry about 1.4 times the “surprise” of a six-week gap, or 40% more, although offsetting data can dilute the effect. With six votes, quarter-point steps would cap annual moves at 1.5 points rather than 2, which could force half-point adjustments; the Fed delivered that magnitude across three meetings between March and June 2022. Sweden’s Riksbank cut meetings from six to five in 2019, then raised rates by 1 percentage point in one step in September 2022 and reverted to eight meetings from 2024. So far, Warsh’s four decision days since June have moved the two-year yield by just under 0.1 percentage point on average, while October’s announcement day saw a 0.03-point move; since 2024, decision-day moves versus normal days have ranged from roughly equal to almost double.
