Fewer Fed rate votes, more debate: FOMC calendar reset
Warsh wants FOMC meetings for strategy, with fewer rate votes but format still undecided
Dubai: The US Federal Reserve will cut the number of meetings at which it sets interest rates in 2027 and 2028. Chairman Kevin Warsh announced the change during his October rate meeting discussion and said that the move was intended to create room for longer-term strategy discussions.
The Federal Open Market Committee (FOMC) will keep its eight meetings that take place bi-monthly all year round. However, the rate-setting sessions will drop down to seven in 2027 and six in 2028. The remaining meetings, one in 2027 and two in 2028, will focus on monetary policy strategy.
The Fed unveiled the plan on the day it held its benchmark rate at 3.75 to 4 percent. That pause follows a quarter-percentage-point increase in September. Strategy sessions will not ordinarily include votes on the federal funds rate. The Fed does not expect monetary policy statements after them.
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Warsh confirmed the format is not final. The Fed has yet to decide what information it will release afterwards. “It’s not obvious yet,” he said, adding that “there’s more news to come on that.” He called the calendar “more than some administrative detail”. The schedule, Warsh argued, is an institutional choice that shapes the quality of the Fed’s deliberations and decisions.
Currently, each of the eight meetings offers a chance to change rates. Policymakers get few openings to weigh developments that do not fit the rate cycle. Dedicated sessions address that gap.
How will the UAE be impacted?
The UAE central bank (CBUAE) tracks Fed policy closely because the dirham is pegged to the dollar at Dh3.6725. CBUAE has typically adjusted its base rate shortly after the Fed changes rates, and the Fed’s new calendar leaves that link intact.
However, what changes is the frequency. With six rate-setting meetings in 2028 instead of eight, CBUAE will have fewer Fed decisions to follow. Strategy-only sessions are not expected to carry rate votes, so they should not trigger any local move either. Banks and borrowers in the UAE may see longer gaps between rate changes. CBUAE has not commented on the revised schedule.
