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Fed keeps rates steady, three policymakers dissent and prefer a hike

The Fed left its benchmark rate in the 3.5% to 3.75% range, with the dissenters favoring a quarter point increase despite inflation staying elevated versus the 2% target.

Reported · Written up by our desk · Central Banks

The Federal Reserve held interest rates steady on Wednesday, leaving the benchmark range at 3.5% to 3.75%, a decision that is likely to sharpen scrutiny around new chair Kevin Warsh’s pledge to bring inflation back to the central bank’s 2% goal. SCMP Economy, citing reporting on the Fed’s decision, said three of the 12 policy-setting Federal Open Market Committee members dissented, preferring a quarter point hike at this meeting.

The outlet noted the same three regional bank presidents, from Cleveland, Dallas and Minneapolis, had also dissented at Jerome Powell’s final meeting in late April. At that time, they backed removing the implied promise of lower rates, according to the report.

In its short policy statement after the two-day meeting, the Fed said inflation remains elevated relative to the 2% goal and replicated word for word the prior June 17 assessment. The statement also said economic activity is expanding at a solid pace, job gains have kept pace with the workforce, and the unemployment rate has changed little.

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