Divided Fed holds rates steady as three members vote for a hike
The Federal Open Market Committee voted 9-3 to hold the federal funds rate steady at 3.5%-3.75%, even as three policymakers pushed for a hike. The split vote underscores growing internal disagreement over how to handle persistent inflation.
The Federal Reserve held interest rates steady for a fifth straight meeting, in line with expectations, but the split vote drew attention. Three members of the Federal Open Market Committee pushed for a hike, arguing progress against inflation had stalled.
The decision rattled markets, with the Dow closing sharply lower and bond yields climbing as investors weighed what the internal division means for the path ahead. Analysts said the dissents signal a harder fight looms over the next moves.
The Fed chair acknowledged there is "no magic wand" to tackle high prices, conceding inflation remains stubborn. Markets are now focused on whether the next meeting brings a shift in direction.
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The Dow Jones Industrial Average tumbled about 800 points on Wednesday, giving back gains from its prior three-day rally as investors turned cautious ahead of the Federal Reserve's interest-rate decision. Traders are weighing whether policymakers will hold rates steady given persistent inflation pressures and volatile energy prices. The decline weighed on major indexes across Wall Street.
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