Fed Keeps Rates Unchanged for Fifth Straight Meeting, Reaffirms 2% Inflation Goal

Huo Xing Finance reported that on July 30 the Federal Reserve left the federal funds rate unchanged for a fifth consecutive meeting, maintaining the target range at 3.50%–3.75%. The Federal Open Market Committee approved the decision in a 9–3 vote. Three regional Fed presidents dissented in favor of a rate increase, marking the first time since 2016 that three officials have consistently backed a hike. At the post-meeting press conference, Fed Chair Walsh said the central bank does not have a “soft inflation target,” reiterating that its objective remains 2% inflation. He said the Fed would act decisively when “necessary and appropriate” if inflation stays persistently high. Walsh also rejected describing the decision as a “pause,” arguing that the current step should be seen as the start, not the conclusion, of the policy process. He added that market pricing is for observation only and will not drive policy decisions. Walsh said U.S. economic activity remains resilient, citing strong productivity, capital spending and investment in AI. He added that the labor market continues to hold up well, with the Fed “doing quite well” on its full-employment mandate, and said policymakers are conducting a rigorous assessment of incoming conditions. On the dissenting votes, he said the committee held extensive discussions, while the final decision still drew overwhelming support. Markets moved sharply during and after the statement and press conference. Spot gold rose more than $50 and broke above $4,100. The U.S. dollar index slipped below 101. The 2-year Treasury yield fell about 8 basis points, while the 30-year yield climbed roughly 10 basis points. Rate markets trimmed overall expectations for additional hikes this year, but still priced in around 15 basis points of tightening for September. Trump later said Walsh wants to cut rates, but that the Fed has a “political board.”