The US Federal Reserve has held interest rates steady, with surging inflation fuelled by President Donald Trump’s war on Iran seeing three of the committee’s 12 policymakers calling for a quarter-percentage-point rate hike.
The Fed’s open market committee (FOMC) held rates at 3.50-3.75 percent for the fifth straight meeting, with its chairman Kevin Warsh denying that he was reticent to take action against the inflation that has battered US households for more than five years.
“We are on the job. We will deliver. We are focused like a laser, making sure we can do it,” he said, adding that there was “no magic wand” with which the Fed could lower inflation quickly.
Warsh insisted the economy was showing “impressive resilience, with recent shocks.”
Since taking office, the new Fed chair — who was nominated by Trump, who has demanded lower interest rates — has repeatedly said he wanted a “good family fight” at rate decision meetings.
On Wednesday, he said he got one, with three regional Fed presidents dissenting from the majority and recommending the central bank start raising rates now.
“Most of our discussion was on the big questions that matter to the conduct of monetary policy. We didn’t sort of hide from them. We weren’t scared of them,” Warsh told reporters.
“There was a lot more interaction between and among my colleagues. It was a real family fight.”
It is rare for that many FOMC members to differ from the majority’s vote.
