Fed holds interest rates as new Iran tensions raise inflation risks

The Federal Reserve held interest rates steady for a fifth straight time Wednesday amid mounting pressure on the bank to stay ahead of another war-driven energy price shock.

In a 9-3 decision, the Federal Open Market Committee (FOMC) maintained its baseline interest rate at a range of 3.5 percent to 3.75 percent. It marked the second consecutive hold under new Fed Chair Kevin Warsh, who succeeded Jerome Powell in May.

Federal Reserve Bank of Dallas President Lorie Logan, Cleveland Fed President Beth Hammack and Minneapolis Fed President Neel Kashkari all voted to raise rates by 0.25 percentage points.

The FOMC’s vote did not come as a surprise, with financial markets setting the odds of no change at 69.5 percent as of Wednesday, according to the CME FedWatch tool, which tracks bets placed on future Fed rate decisions.

All 104 economists Reuters surveyed earlier this month also expected the Fed to leave borrowing costs........

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