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Fed keeps federal funds rate steady, three FOMC members dissent
The Fed held the target range at 3.5% to 3.75% for a fifth straight meeting, while dissenters voted for a 25 basis point hike, underscoring ongoing inflation concerns.
The US Federal Reserve kept interest rates unchanged on July 29, holding the federal funds rate steady in a target range of 3.5% to 3.75% for the fifth consecutive policy decision.
The FOMC policy decision matched the statement issued in June, with Chairman Kevin Warsh reiterating the Fed’s focus on bringing inflation down, which has been above the central bank’s 2% goal for five years.
In a notable split, three of the 12 policymakers, the presidents of the Fed’s Cleveland, Dallas, and Minneapolis regional banks, dissented and voted for a 25 basis point increase. The article says it was the first time in nearly 10 years that three policymakers dissented with a unified view on the direction of rates.
While the market had expected the Fed to keep rates on hold, the three dissents and the emphasis on price stability highlight the possibility that the Fed could consider further hikes, potentially as soon as September, depending on incoming inflation data, according to LiveMint Markets.