NewzThe surge in Treasury yields suggests investors doubt that the Federal Reserve can keep inflation contained. WASHINGTON, July 29 (Yonhap) -- The U.S. Federal Reserve on Wednesday held its b...
Interest rates have been tipped to stay on hold when the RBA board meets in August. The Fed’s rate-setting committee reached its decision after two days of deliberations, marking the fifth straight meeting at which the benchmark rate was kept at around 3.6%. Fed officials held interest rates steady, but they have splintered over how to fight inflation.
The Federal Reserve left its interest rate target unchanged Wednesday amid significant internal dissent from officials who preferred to raise rates.The big picture: The central bank elected not to surprise markets with an interest rate hike, contrary to rampant speculation on Wall Street in recent days. But three members of the policy-setting Federal Open Market Committee did favor raising the cost of borrowing.Cleveland Fed president Beth Hammack, Minneapolis Fed president Neel Kashkari, and Dallas Fed president Lorie Logan preferred a quarter-point rate hike, with the other nine officials, including chairman Kevin Warsh, voting to stand pat.Driving the news: The committee left its target range for the federal funds rate between 3.5% and 3.75%, where it has stood since December."Economic activity is expanding at a solid pace despite elevated uncertainty that owes, in part, to the conflict in the Middle East," said the post-meeting policy statement, repeating language from the June meeting.Indeed, the statement was virtually unchanged from the last meeting, offering no clues as to whether or in what circumstances the committee might raise rates later this year.Between the lines: Speaking to reporters for the second time since becoming Fed chairman, Warsh affirmed the Fed's commitment to its 2% inflation target — despite several years of inflation being well above that."There is no soft implicit target, not on this committee's watch," Warsh said at a news conference. "We understand that the five-plus years of inflation above target cannot be cured in nine weeks — or by a single month of modest price decreases," he added.State of play: While most Fed watchers anticipated the holding action and financial markets priced it in as the most likely result of the meeting, there were rumblings in the last 10 days that persistently high inflation combined with a resurgence in energy prices might prompt a rate hike.Before the meeting, markets put the odds on that outcome at roughly 1 in 3, the most uncertainty around a Fed rate decision in years.Warsh, in his second meeting at the helm, has eschewed the kind of clear guidance about future rate moves that his predecessors tended to use — instead favoring that policy meetings feature a "good family fight," where the outcome isn't pre-ordained.The intrigue: Warsh said that pullback in so-called forward guidance might help…
Federal Reserve Chairman Kevin Warsh testifies before the Senate Banking, Housing and Urban Affairs Committee to deliver the semiannual monetary policy report to congress, on Capitol Hill, Wednesday, July 15, 2026, in Washington. (AP Photo/Jose Luis Magana)df Federal Reserve Chairman Kevin Warsh testifies before the Senate Banking, Housing and Urban Affairs Committee to deliver the semiannual monetary policy report to congress, on Capitol Hill, Wednesday, July 15, 2026, in Washington. (AP Photo/Jose Luis Magana)df WASHINGTON (AP) — The Federal Reserve left its key interest rate unchanged Wednesday despite persistently high inflation and a spike in energy prices caused by the Iran war.
The Fed’s rate-setting committee reached the 9-3 decision after two days of deliberations, marking the fifth straight meeting at which the benchmark rate was kept at around 3.6%. Dissenting in favor of a quarter-point interest rate hike were Beth Hammack, president of the Federal Reserve Bank of Cleveland; Neel Kashkari, president of the Minneapolis Fed; and Lorie Logan, president of the Dallas Fed. In reaction to the dissents, Fed Chair Kevin Warsh told reporters at a press conference following the Fed’s announcement, “I asked for a good family fight and I got one.” Inflation has been stuck above the central bank’s 2% target for more than five years.
The Iran war has generated uncertainty over the economic outlook and has driven energy prices higher, intensifying inflationary pressure and creating a quandary for Fed policymakers. Hammack, Kashkari and Logan had previously called for or signaled that they would be open to raising rates to combat high prices. Warsh, presiding over his second meeting of the central bank’s rate-setting committee, has declared that he has “no tolerance” for elevated inflation.
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