U.S Fed holds rates steady at 3.5-3.75%

July 29, 2026 (MLN): The U.S Federal Reserve kept its benchmark interest rate unchanged at a range of 3.50% to 3.75%, a decision widely expected by markets, as the Federal Open Market Committee (FOMC) continued to weigh elevated inflation against a resilient labour market.

The move was approved by a 9-3 vote, with the central bank maintaining its policy of holding ample reserves in the banking system, according to a press release issued by the Federal Reserve.

The Committee said economic activity is expanding at a solid pace, though uncertainty remains elevated, partly linked to the conflict in the Middle East.

Productivity growth and capital investment were described as strong, while job gains have kept pace with the workforce and the unemployment rate has shown little change.

On inflation, the FOMC noted price growth remains elevated relative to its 2% target, partly reflecting supply shocks that have pushed up prices in certain sectors, including energy.

The Committee reiterated its commitment to restoring price stability.

Three officials Beth M. Hammack, Neel Kashkari and Lorie K. Logan  dissented from the decision, having preferred a quarter-percentage-point increase in the target range at this meeting.

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