WASHINGTON—As expected, the Federal Reserve has opted to leave rates unchanged for a fifth straight meeting, although two members of the Federal Open Markets Committee dissented and called for rates to be cut immediately.
The decision to leave rates set at a range between 4.25% and 4.5% comes even as President Trump has demanded the Fed make a move.
In its statement explaining the decision not to adjust rates, the Fed used wording similar to that it has used following other recent meetings saying it remains concerned over the effects of President Trump’s tariffs on inflation.
Some economists have been warning that while the pace of inflation has cooled, as businesses with thinner margins deplete their pre-tariff stock and face higher costs due to tariff increases, they’ll increasingly be forced to pass these expenses on to consumers.
A First Since 2020
The just-adjourned meeting was the first since 2020 in which more than one Fed official voted against Fed Chairman Jerome Powell, and the first since 1993 in which more than one board governor dissented, according to the Wall Street Journal.
Dissenting from the decision were Michelle Bowman and Christopher Waller, who both favored reducing rates by a quarter point.
“Bowman’s dissent marked a notable shift for someone who had been a leading advocate for tighter policy in recent years and who opposed an initial cut from higher levels last September,” the Journal noted.
