Fed defies Trump with US rate hike: Central bank chief Kevin Warsh pulls trigger in first increase for three years
Kevin Warsh (pictured), who was hand-picked by Trump as Fed chief - said the central bank had acted to remove 'a dose of accommodation' from the economy.
The U.S. Federal Reserve announced on Wednesday a quarter-point increase in its benchmark interest rate, marking its first rate hike since July 2023. The decision, made unanimously during a two-day Federal Open Market Committee (FOMC) meeting, comes amid persistent inflation and high oil prices. Despite repeated calls from U.S. President Donald Trump for the central bank to lower borrowing costs, the Fed maintained its stance, signaling a potential further increase this year.
The median projection from FOMC members now anticipates the federal funds rate reaching 4.1 percent by year-end, up from the June projection of 3.8 percent. Fed Chair Kevin Warsh did not provide his own dot plot projection. Rising consumer price inflation, excluding volatile food and energy costs, gained 0.3 percent in August, slightly above expectations.
Fed Chair Warsh emphasized the central bank's commitment to price stability, stating that inflation has been "too high" and "for too long."
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