Federal Reserve Holds Rates Steady, New Chair Warsh Hints at Hikes

The U.S. Federal Reserve kept its policy interest rate unchanged in the range of 3.5%‑3.75% at its first meeting under new chair Kevin Warsh. The decision was unanimous among the twelve voting members, marking the fourth consecutive meeting with no change.

Warsh, appointed by President Donald Trump to succeed Jerome Powell, indicated that about half of the committee members see a possible rate increase later in the year as inflation remains above the Fed’s 2% target (4.2% in May). He announced the creation of a task force to review five key areas of monetary policy – communication, balance sheet, data sources, productivity/employment, and inflation models – and pledged to maintain price stability amid upcoming congressional elections.