Fed Keeps Interest Rate at 3.5–3.75%

The U.S. Federal Reserve kept the federal funds target range unchanged at 3.5–3.75% following its April 29 meeting.

The decision matched the consensus forecast, but the voting results revealed deep divisions within the Federal Open Market Committee (FOMC). Policymakers were divided not only over the current interest rate level but also over the future direction of monetary policy.

Stephen Miran voted against the decision, calling for a 25-basis-point rate cut at this meeting. Meanwhile, Beth Hammack, Neel Kashkari, and Lorie Logan supported keeping the current target range unchanged but opposed including language in the statement that would suggest policy easing in the near term.

According to the FOMC statement, the U.S. economy continues to expand at a solid pace, unemployment has changed little in recent months, and inflation remains above the Fed’s 2% target. The Fed also said that rising global energy prices have increased inflationary pressures, while the situation in the Middle East has increased uncertainty about the economic outlook.

Earlier:

• The Fed Held Rates Steady but Shifted Its Outlook Toward Tightening

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