Fed holds rates steady but nearly half of policymakers signal possible 2025 rate hike amid inflation concerns
By
Christopher Rugaber
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Summary
The Federal Reserve held its key interest rate steady but revealed that nearly half of its policymakers would support a rate hike later this year, signaling heightened inflation concerns. The unexpectedly hawkish stance would disappoint President Trump, who has pushed for lower rates. The unusually brief statement, influenced by new Fed Chair Kevin Warsh (a Trump appointee), dropped previous language suggesting the next move would be a rate cut.
Key quotes
· 3 pulledThe Federal Reserve kept its key rate unchanged Wednesday yet almost half the central bank's policymakers said they could support a rate hike later this year, an unexpectedly aggressive outcome that would disappoint President Trump and suggests heightened concerns about persistent inflation.
In an unusually short statement after their two-day meeting, Fed officials dropped language that had suggested their next move would be to cut their key rate.
The brief statement reflects the influence of new chair Kevin Warsh, appointed by Trump, who has previously criticized the Fed for commenting too broadly on the economy.
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