Fed holds rates steady in first meeting under Warsh

The US Federal Reserve left interest rates unchanged on Wednesday for a fourth consecutive meeting, keeping the federal funds rate target range at 3.50%-3.75%, in line with expectations, in its first policy meeting under new Chair Kevin Warsh.

The Federal Open Market Committee unanimously voted to keep interest rates unchanged, while reiterating its commitment to maintaining ample reserves in the banking system.

The statement described economic growth as remaining strong despite elevated uncertainty, noting that part of the uncertainty stems from the conflict in the Middle East. It also highlighted continued strength in productivity and capital investment, while indicating that job creation remains broadly in line with labor force growth and that the unemployment rate has changed little.

On inflation, policymakers acknowledged that price pressures remain above the Fed's 2% target, attributing part of the persistence to supply-side shocks that have pushed prices higher in certain sectors. The Committee reaffirmed its commitment to restoring price stability.

Notably, the statement omitted previous language that had pointed to the possibility of future interest-rate cuts, suggesting policymakers remain cautious about easing monetary policy despite signs of moderating inflation in some areas.