On Wednesday, July 29th, 2026, the US Federal Reserve decided to keep interest rates steady in the range of 3.50% to 3.75%. This move, widely anticipated, came despite Federal Reserve Chair Kevin Warsh's firm stance on combating inflation, which has remained above the central bank's 2% target for over five years.

The policy-setting Federal Open Market Committee (FOMC) saw dissent from three of its 12 members, including the presidents of the Fed’s Cleveland, Dallas, and Minneapolis regional banks, who preferred a quarter-percentage-point rate hike at this meeting. These dissenters had also opposed the previous policy stance in April.

Warsh, who assumed leadership of the Fed in May, has expressed "no tolerance" for the persistent inflation, which until last month was exacerbated by the war in the Middle East pushing up global fuel and food prices, alongside increased demand driven by investments in data centers and artificial intelligence.

In its policy statement following the two-day meeting, the Fed noted, "Inflation remains elevated relative to the committee’s 2 per cent goal." The statement also reiterated the June 17 assessment of the economy, highlighting that economic activity is "expanding at a solid pace," with job gains keeping pace with the workforce and little change in the unemployment rate.

This decision to hold rates steady may intensify scrutiny over how Warsh plans to achieve the inflation target amid ongoing economic pressures.

Sources