<\/p>\n
US Federal Reserve officials left interest rates unchanged and reiterated their commitment to containing inflation, but without offering a clear signal they might raise rates at their next meeting in December.<\/p>\n
\u201cThe accumulation of more information will help the committee determine the policy stance appropriate to ensure a timely return of inflation to the committee\u2019s 2% goal,\u201d policymakers said on Wednesday in a post-meeting statement.<\/p>\n
\u201cThe committee will deliver price stability.\u201d<\/p>\n
Read: IMF says US growth not enough to fight high debt, deficit levels<\/p>\n
The Federal Open Market Committee (FOMC) voted 10-2 to hold its benchmark federal funds rate in a range of 3.75% to 4%.<\/p>\n
Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, preferring to raise rates by a quarter percentage point.<\/p>\n
The decision to hold rates comes less than a week before the November midterm elections.<\/p>\n
Amid widespread discontent over the economy, Democrats are favoured to win a majority in the House of Representatives and have a polling edge in several key races for the Senate.<\/p>\n
The S&P 500 and Treasury yields remained higher following the decision.<\/p>\n
Read: Trump faces widening GOP anger over Russia sanctions waiver<\/p>\n
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Fed Chair Kevin Warsh is scheduled to hold a press conference in Washington later on Wednesday.<\/p>\n
He is likely to be pressed to explain the Fed\u2019s decision not to raise rates despite persistent price pressures and signs of a strong economy.<\/p>\n
The consumer price index rose in September at its fastest pace in five months. That was driven largely by higher energy prices connected to the Iran war, but the report also showed\u00a0broad-based inflation\u00a0across goods and services.<\/p>\n
Read: Trumpflation and other frustrations<\/p>\n
Policymakers will get fresh data on Thursday when the Bureau of Economic Analysis releases the September reading for the Fed\u2019s preferred inflation gauge, the personal consumption expenditures price index.<\/p>\n
Strong consumer spending and a crush of investment into artificial intelligence also continue to boost growth.<\/p>\n
Economists expect that figures also due out on Thursday will show the US economy grew at a robust annualised pace of about 3.2% in the third quarter.<\/p>\n
The post-meeting statement repeated its prior descriptions of economic activity as expanding \u201cat a strong pace\u201d and domestic spending as \u201cresilient\u201d.<\/p>\n
It also reiterated that the unemployment a rate had changed little and inflation remained elevated.<\/p>\n
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Rollercoaster rate expectations<\/p>\n
Investors\u2019 expectations for this meeting changed drastically over the course of recent weeks.<\/p>\n
Soon after the Fed\u2019s decision to hike interest rates in September, bets for another increase this month climbed above 70%, according to pricing in federal funds futures.<\/p>\n
That changed after two key FOMC voting members \u2013 New York Fed President John Williams and Vice Chair Philip Jefferson \u2013 said the central bank\u2019s September move had bought time to assess the state of the economy.<\/p>\n
The odds of a hike in investors\u2019 eyes promptly fell below 30% and have continued to drop. They stood below 10% earlier Wednesday.<\/p>\n
Warsh weighed in on 16 October, when he said \u201cthe world has broadly conformed to our expectations\u201d since the Fed\u2019s September meeting.<\/p>\n
Markets interpreted that as a decision not to reset investor expectations, and thus an implicit signal that officials were likely to leave rates unchanged.<\/p>\n
The dissent by Cook comes as she continues to challenge President Donald Trump\u2019s attempt to\u00a0fire her. Administration officials have scheduled a hearing at the White House in\u00a0early November\u00a0to examine allegations of mortgage fraud that Cook has long denied.<\/p>\n
Cook has\u00a0said\u00a0she would not be able to attend the hearing.<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#Fed #holds #rates #Moneyweb<\/p>\n","protected":false},"excerpt":{"rendered":"
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