United States Interest Rate

The Fed held rates steady at 4.25%–4.50% for a fifth straight meeting, as expected, but two governors dissented in favor of a cut—the first such dual dissent since 1993. Policymakers observed that, while fluctuations in net exports continue to influence the data, recent indicators point to a moderation in economic activity in H1—contrasting with earlier assessments that growth was proceeding 'at a solid pace'. The Fed also said that the unemployment rate remains low while inflation remains somewhat elevated, and uncertainty about the economic outlook persists. The Fed reinforced that additional adjustments to the interest rate will depend on incoming data, the evolving outlook, and the balance of risks. The central bank maintained a wait-and-see approach amid rising concerns that the ongoing trade war could undermine progress toward the 2% inflation target.