The US Federal Reserve has kept interest rates steady in its final policy decision before the upcoming midterm elections, noting that while the broader economy remains resilient, inflation continues to run high.
During the announcement, Federal Reserve Chair Kevin Warsh stated that the decision to maintain the current rate was not unanimous, with two of the 12 board members voting to raise rates. Last month, the central bank raised rates for the first time in three years to 3.75%-4%, hinting at additional hikes this year to help curb inflation. Warsh stated that despite "geopolitical developments" the US economy is resilient but inflation remains elevated, and emphasized that "politics played no role in the decision" to maintain the rates.
President Trump strongly opposes interest rate hikes and had pushed for a quick cut following the bank's September decision.
The decision comes as voters grapple with cost-of-living concerns ahead of next week's midterm elections. Households are feeling the pinch of rising prices at the petrol pump and in the supermarket, while central banks often raise rates when inflation is too high to help cool borrowing, mortgages, car loans, and student debt.
