Fed Holds 3.75%-4% Rate; Two Seek Hike — SkimNews
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- FOMC kept the overnight funds rate at 3.75%-4%, unchanged since September’s quarter-point increase, while the preferred inflation gauge was expected above 3% for September even excluding volatile food and energy.
- Lisa Cook cast her first dissent since joining the Fed in 2022, joining Cleveland Fed President Beth Hammack in seeking a quarter-point increase.
- Lorie Logan, who joined Hammack in voting against the July hold, voted with Wednesday’s majority alongside Neel Kashkari, leaving Cook and Hammack as the only dissenters.
- Philip Jefferson said current economic conditions allow policymakers time to evaluate their next move, a view John Williams also expressed.
- FOMC faced less than a 10% market-implied chance of a Wednesday hike, while futures pricing assigned a strong possibility to another increase at its December meeting.
- Trump has tried to remove Lisa Cook over allegations about information she provided on home-loan applications; after the Supreme Court blocked the first effort, the administration restarted the move with a hearing set for early November.
- GDPNow pointed to 3.4% annualized third-quarter growth, which would be the strongest in a year, as consumer spending stayed solid and artificial-intelligence investment supported activity.
Why it matters: For Fed policymakers, the hold was nearly discounted, with less than a 10% chance of a Wednesday hike. The two dissents for a 25-basis-point increase and futures pricing that makes a December hike a strong possibility keep additional inflation data central to the coming policy debate.
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