Fed holds rates days before midterms as two officials vote for a hike
The U.S. Federal Reserve kept its benchmark rate at 3.75% to 4%. Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented in favor of a hike. Chair Warsh said conditions have tightened.
Archive image · Photo: Federalreserve / Wikimedia Commons, Public domain (cropped and resized)
The U.S. Federal Reserve on Wednesday held its key interest rate in a range of 3.75% to 4%. The vote was 10-2, with Governor Lisa Cook and Cleveland Fed President Beth Hammack favoring a quarter-point increase. In September, the Fed raised rates for the first time in three years.
In its statement, the central bank upgraded its view of economic activity to "strong" from "solid" and said further steps would depend on incoming data. Fed Chair Kevin Warsh said financial and credit conditions had tightened for some businesses and households since September. "While overall financial conditions are tighter, I'm unwilling and unable to call them tight," he said.
The meeting came less than a week before congressional elections dominated by the cost of living. Consumer prices rose 3.7% in September from a year earlier, with upward pressure from higher energy prices and the AI infrastructure buildout, AP reported. President Donald Trump had criticized the September hike. The Fed next meets Dec. 8-9.