Fed Holds Rates as Two Officials Dissent for a Hike; Treasury Yields Rise

what happened

According to Market Talk, the Federal Reserve left interest rates unchanged, as widely expected. Governors Lisa Cook and Beth Hammack voted against the decision and argued for a rate increase instead.

The Fed's statement described economic activity as expanding at a strong pace and spending as resilient, while inflation remains elevated. It also said uncertainty stays high, partly because of geopolitical developments. The 10-year Treasury yield touched 5.04% intraday and the two-year stood at 4.78%, ahead of Chairman Warsh's press conference.

Elsewhere, the Bank of Canada raised its policy rate by a quarter point, its first increase in more than three years. TD Securities expects another move in December, taking the rate to 2.75%, while RSM sees further hikes in 2027. Gold futures settled 0.6% lower at $4,036.00 an ounce, and silver fell 1.5% to $53.457, its lowest close since November 26, 2025.

why it matters

A hold with two votes for a hike points to a more hawkish Fed ahead, which pressures long-dated bonds and makes non-yielding gold less attractive. Investors will watch the PCE and GDP data due later this week for the next signal.

market impact

US Treasuries: higher yields after hawkish Fed dissents; gold and silver pressured by rate expectations

• ▼US Treasuries pressure down — rising yields after hawkish dissents signal possible rate hikes ahead
• ▼Gold pressure down — higher rate expectations weigh on the non-yielding metal
• ▲Canadian dollar pressure up — the Bank of Canada's first hike and expectations of more support the currency

tags

instruments