Fed Holds Rates, but Warsh Is Shrinking Its Rate-Setting Calendar

Federal Reserve Chair Kevin Warsh kept interest rates at 3.75% to 4.00% on Wednesday and said the Fed will reduce its rate-setting calendar beginning in 2027, when one of eight meetings will skip rate votes; he expects six of eight meetings to set rates in 2028. Such strategy meetings would have no policy statement or vote on the federal funds rate. The hold was not unanimous: the vote was 10-2, with Governor Lisa Cook and one other official dissenting in favor of a hike. Warsh said first-half growth estimates rose to 2.4% from 1.8% and inflation has exceeded target for nearly six years, with new data to inform a December decision.