The Federal Reserve held interest rates steady on Wednesday, opting to wait for more economic data before raising rates again at its final meeting of the year in December. Officials believe they have the flexibility to gather information on inflation, though two governors -- Lisa D. Cook and Beth M.
Hammack -- dissented, voting for a quarter-point increase. Fed Chairman Kevin M. Warsh cited strong economic growth and tighter credit conditions, including volatility in equity markets and costlier financing for artificial intelligence companies, as reasons to pause.
He emphasized that while inflation expectations have moved higher, the economy is not yet overheating. With inflation still above target due in part to an energy shock from the war with Iran, the Fed faces a delicate balance. Richard Clarida of Pimco suggested one or two more rate increases after December are plausible if inflation does not decelerate.
The Personal Consumption Expenditures price index is due Thursday, which will provide the latest read on core prices.
Source: New York Times Top Stories · Summarized by HeadlinesBriefing