Fed Holds Rates Steady, But 'Hawkish' Dissent Grows

The U.S. Federal Reserve (Fed) decided on the 29th (local time) to keep the benchmark interest rate at its current level of 3.50-3.75%. The decision by the Federal Open Market Committee (FOMC) was made by a 9-3 vote, with all three dissenting members supporting a 0.25 percentage point rate hike.

In its statement, the FOMC noted that inflation remains above its 2% target and reiterated its commitment to price stability. Fed officials projected one more rate hike by the end of the year.

Fed Chair Jerome Powell made remarks that effectively condoned rising market interest rates. Powell stated that rate hikes could still be a future policy option if inflation remains elevated and the labor market stays strong. President Donald Trump praised Fed Chair Jerome Powell as a fantastic, outstanding, and smart person.

Earlier in the day, the U.S. military launched airstrikes in retaliation for Iran's attack on a U.S. base in Jordan the previous day. President Donald Trump had previously warned of a strong response against Iran.