Fed Holds Rates as Dissent Flows Amid Powell’s Continued Board Tenure

The Federal Reserve kept the federal funds rate at 3.5%‑3.75% with an 8‑4 vote, marking unusually sharp internal disagreement not seen since 1992 as inflation remains elevated and policy messaging shifts. Powell said he will stay on the Board indefinitely amid an ongoing renovations probe, while Kevin Warsh advances toward the chairmanship, potentially changing the Fed’s stance. Dissenters Hammack, Kashkari and Logan objected to an easing bias in the statement. Inflation remains driven in part by energy costs, markets were positioned for no rate change this year, and the labor market remains healthy, underscoring a leadership transition that could influence policy directions.