--- title: "The Fed Just Hiked Rates for the First Time Since 2023: What It Actually Means for Your Money in Singapore" description: The Fed raised rates to 3.75%-4% in September 2026, its first hike in three years. Here's what it means for CPF, T-bills and mortgages in Singapore. --- # [The Fed Just Hiked Rates for the First Time Since 2023: What It Actually Means for Your Money in Singapore](https://www.thefinancialcoconut.com/blog/the-fed-just-hiked-rates-for-the-first-time-since-2023) Written by [The Financial Coconut](https://www.thefinancialcoconut.com/blog/author/the-financial-coconut) | Oct 1, 2026, 5:30:09 AM   The US Federal Reserve raised its benchmark rate to 3.75%-4% on 16 September 2026, its first hike in three years, citing inflation that remains "too high for too long". For Singaporeans, the immediate effect is not your mortgage. It is your savings: T-bill and fixed deposit yields have already jumped, while CPF rates and SORA have barely moved. ## What did the Fed actually decide? The Federal Open Market Committee voted unanimously, 12-0, to lift the federal funds rate by 25 basis points to a target range of 3.75% to 4%, effective 17 September 2026. It was the first increase since July 2023. Fed Chair Kevin Warsh pointed to persistent inflation above the 2% target, alongside a resilient labour market and strong capital investment, as the reasons for the move. Market pricing after the meeting put roughly even odds on a further quarter-point hike at either the October or December meeting, so this is unlikely to be a one-off. ## Why does a US decision move money in Singapore? Singapore's Treasury bills and Singapore Savings Bonds are priced at auction, where the yield reflects what global investors demand to hold them right now. When US rates rise and global bond yields follow, bidders at MAS auctions ask for more too, so yields adjust within days. Bank fixed deposit rates tend to follow soon after, as banks compete for deposits in a higher-rate environment. Your home loan works differently. Most Singapore mortgages are pegged to SORA, which reflects actual overnight transactions in the Singapore dollar money market, shaped by MAS's own exchange-rate-centred monetary policy rather than the US fed funds rate directly. That is why a Fed hike does not mechanically reprice your loan the way it might a US borrower's. ## How much have Singapore T-bill and fixed deposit rates actually moved? The numbers already show the split. At the 24 September 2026 auction, the 6-month T-bill's cut-off yield jumped to 1.92%, up 22 basis points from 1.70% just two weeks earlier and the largest single jump of the year, with total bids falling to S$15.8 billion from S$16.6 billion. Several banks moved in the same window too, with at least eight of ten banks tracked by local comparison sites raising fixed deposit rates within a single week in September, some now paying up to 2% per annum. Meanwhile, 3-month compounded SORA sat at roughly 1.23% as of 24 September 2026, a fraction of the Fed's new range and not meaningfully different from where it sat before the Fed meeting. ## Has anything changed for your CPF or your mortgage? Not for CPF. Rates for the fourth quarter of 2026 (1 October to 31 December) are confirmed unchanged: Ordinary Account still pays 2.5%, the Special, MediSave and Retirement Accounts still pay 4%, and the HDB concessionary rate stays at 2.6%. In fact, the government used this same window to extend the 4% floor on SMRA monies for a further year, now running to 31 December 2027, explicitly to give members "certainty on their CPF returns amidst the uncertain economic and interest rate environment." For mortgages, SORA-pegged loans have not repriced off the back of this specific Fed decision. That is worth remembering before refinancing decisions get driven by headlines rather than the number your bank actually references, a distinction TFC unpacked in [why your CPF now pays more than T-bills and Savings Bonds in 2026](https://www.thefinancialcoconut.com/blog/why-your-cpf-now-pays-more-than-t-bills-and-savings-bonds-in-2026). The Fed's own rate path is not fixed either. TFC broke down the mechanics the last time the cycle moved the other way, in [what the Fed's rate cut meant for Singaporean investors](https://www.thefinancialcoconut.com/blog/fed-rate-cut-affect-singapore-investors), and the same transmission logic applies in reverse now. ## So what should you actually do? If you are parking cash, compare the freshly repriced 6-month T-bill and your bank's latest fixed deposit offer against the Singapore Savings Bond's current first-year rate before automatically rolling over, since the ranking between them has shifted in the past fortnight. TFC's [revisit of T-bills and Singapore government bonds as an investment choice](https://www.thefinancialcoconut.com/blog/revisit-tbill-sg-gov-bonds-as-investment-option) is a useful primer if you have not compared these instruments before. For money you will not touch before retirement, CPF's guaranteed 2.5% and 4% still deserve a place in the comparison, not just an afterthought. If you are a borrower, do not assume your SORA-pegged loan is about to jump because of a US headline. It has not moved on this news. Do keep half an eye on the flagged October and December Fed meetings, since a sustained US hiking cycle can eventually feed through to global bond yields and, with a lag, to Singapore rates more broadly. ## FAQ 1. **Did the Fed cut or raise interest rates in September 2026?** It raised rates, by 25 basis points to a target range of 3.75%-4%, its first hike since July 2023. 2. **Will my Singapore mortgage rate rise because of the Fed hike?** Not automatically. Most Singapore home loans are pegged to SORA, which reflects Singapore dollar money market conditions rather than the US fed funds rate. As of 24 September 2026, 3-month compounded SORA was around 1.23% and had not moved meaningfully on this news. 3. **Are Singapore T-bill and fixed deposit rates rising?** Yes. The 6-month T-bill's cut-off yield jumped to 1.92% at the 24 September 2026 auction, its largest weekly jump this year, and several banks raised fixed deposit rates in the same period. 4. **Did CPF interest rates change after the Fed's move?** No. CPF rates for October to December 2026 are unchanged, with the Ordinary Account at 2.5% and the Special, MediSave and Retirement Accounts at 4%. The government has also extended the 4% floor on those accounts to 31 December 2027. A US rate decision does not automatically rewrite your Singapore finances. This time, it has lifted what savers earn on T-bills and fixed deposits within weeks, while CPF rates and SORA-linked mortgages have stayed put, at least for now. Worth checking your own accounts against the actual numbers rather than the headline. For more breakdowns like this as the rate story develops, follow The Financial Coconut Podcast and the [Chills with TFC](https://www.thefinancialcoconut.com/invest) series, or join the community via [linkin.bio/thefinancialcoconut](https://linkin.bio/thefinancialcoconut).   ### Reference 1. [Federal Reserve issues FOMC statement, September 16, 2026](https://www.federalreserve.gov/newsevents/pressreleases/monetary20260916a1.htm) Board of Governors of the Federal Reserve System, Implementation Note 2. [Federal Reserve interest rate decision September 16, 2026](https://www.foxbusiness.com/economy/federal-reserve-interest-rate-decision-september-16-2026) Fox Business, September FOMC: Federal Reserve hikes interest rates for first time since 2023 3. [6-month T-bill yield jumps to 1.92%, highest in 2026](https://growbeansprout.com/t-bill-allotment-24-sep-2026) Growbeansprout, 6-month T-bill yield jumps to 1.92%, highest in 2026. Here's what drove the increase 4. [Best fixed deposit rates in Singapore (September 2026)](https://www.misslobang.com/article/best-fixed-deposit-rates-singapore-2026) MissLobang, 10 Best Fixed Deposit Rates in Singapore (September 2026) 5. [Government extends 4% interest rate floor on Special, MediSave and Retirement Account monies until 31 December 2027](https://www.cpf.gov.sg/member/infohub/news/news-releases/government-extends-4-per-cent-interest-rate-floor-on-special-medisave-and-retirement-account-monies-until-31-december-2027) CPF Board, news release 6. [SORA rates in Singapore](https://www.cashew.sg/interest-rates/sora) Cashew, SORA Rates Singapore - Daily Updated SORA Interest Rates Let us know what you think about this topic, and what do you want to hear next. You can now be our community contributor and make a [pitch](https://thefinancialcoconut.com/contact/)to have your favourite personality be on our show. Join our [community group](https://linkin.bio/thefinancialcoconut/?fbclid=PAZXh0bgNhZW0CMTEAAaY2-JSYItZawSUnNP4YhAicLp0H2wXwx8EBmQgbzOJrjA6YRiPWXtFDSH4_aem_t1DMRY5jrSAapreaSX9ntw) and drop us your insights on this topic.   [View full post](https://www.thefinancialcoconut.com/blog/the-fed-just-hiked-rates-for-the-first-time-since-2023) ```json { "@context" : "http://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "The Financial Coconut" }, "dateModified" : "2026-10-01T05:30:09.230Z", "datePublished" : "2026-10-01T05:30:09Z", "headline" : "The Fed Just Hiked Rates for the First Time Since 2023: What It Actually Means for Your Money in Singapore", "image" : { "@type" : "ImageObject", "height" : 2667, "url" : "https://46975693.fs1.hubspotusercontent-na2.net/hubfs/46975693/hundred-dollar-bills-with-green-financial-chart-ba-2026-09-24-06-52-49-utc-jpg.jpeg", "width" : 4000 }, "mainEntityOfPage" : "https://www.thefinancialcoconut.com/blog/the-fed-just-hiked-rates-for-the-first-time-since-2023", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "height" : 60, "url" : "/hs/hsstatic/content_shared_assets/static-1.4092/img/default-amp-logo.png", "width" : 60 }, "name" : "The Financial Coconut Blog" } } ```