Fed discount minutes: two, then four, then seven Reserve Banks asked for 4%
Victoria Shinder2 min readThe Federal Reserve Board released on 13 October 2026 the minutes of its discount rate meetings of 17 August, 9 September and 16 September. The discount rate is set separately from the FOMC's federal funds target, but the minutes show the requests of individual Reserve Banks — and in this case they trace a rising number of banks asking for a higher rate before the Board acted.
17 August: two of twelve. The directors of ten Reserve Banks — New York, Richmond, Atlanta and Dallas on 6 August; Boston, Philadelphia, Chicago, St. Louis, Minneapolis and San Francisco on 13 August — voted to keep the primary credit rate at 3.75%. Kansas City (6 August) and Cleveland (13 August) voted for 4%. The minutes record "no sentiment" on the Board for a change, and 3.75% was kept.
9 September: four of twelve. This time Cleveland, Chicago, Minneapolis and Kansas City voted on 3 September for 4%, while the other eight stayed at 3.75%. Again the Board took no action. The minutes of this meeting also carry the directors' reports on the economy: overall stable conditions, labour markets generally stable with adequate supply and moderate wage pressure — but persistent hiring difficulties and elevated wages for some skilled jobs, including roles tied to firms' AI strategies and data centre construction, and input cost pressure from oil and fuel prices, tariffs, healthcare costs and competition for resources with the AI build-out.
16 September: the increase. At the joint meeting with the FOMC, the Committee raised the federal funds target range by 25 basis points to 3¾–4%, effective 17 September. The Board raised the interest rate on reserve balances from 3.65% to 3.9% and the primary credit rate from 3.75% to 4%. By then seven Reserve Banks had requested 4% — Cleveland, Chicago and Minneapolis (3 September) and Richmond, Atlanta, Kansas City and Dallas (10 September); the remaining five — Boston, New York, Philadelphia, St. Louis and San Francisco — were subsequently informed of approval at 4% from 17 September.
Who voted. Chairman Warsh, Vice Chair Jefferson, Vice Chair for Supervision Bowman and Governors Powell, Waller, Cook and Barr voted for the September actions. Waller and Cook were absent on 9 September; Jefferson was absent on 17 August.
The secondary credit rate stays at 50 basis points above primary credit, and the seasonal rate formula is unchanged.
Source: Federal Reserve Board, minutes of the discount rate meetings on August 17, September 9 and September 16, 2026 — https://www.federalreserve.gov/newsevents/pressreleases/monetary20261013a.htm (minutes PDF: https://www.federalreserve.gov/newsevents/pressreleases/files/monetary20261013a1.pdf)