US Federal Reserve holds interest rates steady at 3.5–3.75%

The US Federal Reserve kept its federal funds rate target range unchanged at 3.5–3.75%, drawing nine votes in favor and three dissents. Beth Hammack, Neel Kashkari and Lorie Logan voted for a quarter-point increase at the meeting. The decision extends a hold that began after the central bank cut rates by a quarter point in December 2025 to reach the current range, which it has maintained since the start of 2026. In the statement released after the two-day meeting, the Federal Open Market Committee said keeping the target range unchanged supported its goals of maximum employment and price stability. The committee said economic activity continued to expand at a solid pace, while uncertainty tied to conflict in the Middle East has increased. It described productivity and capital investment growth as strong, noted that job gains kept pace with labor force growth, and reported no notable change in the unemployment rate. Inflation remained above the 2% target, partly due to supply-driven shocks in sectors such as energy, the statement said. It added that the US–Iran war and rising energy prices have strengthened renewed inflationary pressure concerns. Despite the hold, President Donald Trump reiterated on Monday that the United States should have the lowest interest rates in the world.