Fed Holds Rates at 3.5%-3.75%, Gold Rallies: Warsh Says Goal Is to Keep Inflation Under Control

The Federal Reserve kept its benchmark interest rate unchanged for a fifth straight meeting, holding the range at 3.50% to 3.75%. The decision came as markets expected, but the internal tone reflected sharper disagreement: officials voted 9-3 to maintain rates, while Cleveland Fed president Beth Hammack, Minneapolis Fed president Neel Kashkari, and Dallas Fed president Lorie Logan wanted a quarter-point increase, arguing stubborn inflation has stayed above target for more than five years. Chair Kevin Warsh rejected the idea of a “pause,” saying the committee is conducting a rigorous review and that the process is ongoing. Warsh emphasized the Fed’s commitment to 2% annual inflation and kept the door open to further tightening if needed. Stocks rose modestly, gold held near $1,000 per ounce, and Treasury yields moved higher.