Warsh Fed Holds Rates

The Federal Reserve kept its benchmark interest rate unchanged at 3.5% to 3.75% in Kevin Warsh’s first policy meeting as chair, extending a run of steady-rate decisions despite President Donald Trump’s pressure for cheaper borrowing. Policymakers cited inflation still running above the Fed’s 2% target, uncertainty tied partly to conflict in the Middle East and a still-expanding economy as reasons to wait. The decision was unanimous, but updated projections showed a more hawkish tilt, with nearly half of officials open to at least one rate increase later, including forecasts pointing to a possible hike in 2026. Warsh, who succeeded Jerome Powell in May, declined to submit his own rate forecast, adding uncertainty to how aggressively the new Fed leadership may respond if inflation persists.