Markets are split on whether Federal Reserve policymakers will raise or hold steady their key interest rate at the end of their July meeting today, as Chair Kevin Warsh said he anticipated another “good family fight” and economists expect there could be dissents.
Since taking over as chair in May, Warsh has repeatedly committed to bringing inflation back to its 2% target as Americans continue to face rising prices, but two months into his tenure, it’s unclear exactly how he plans to get there.
The Fed typically raises the federal funds rate, a benchmark for interest rates around the country, to tame inflation. It generally lowers it to stimulate the job market, which picked up in the first half of 2026, even though hiring fell short of forecasters'
expectations in June. The rate-setting committee holds its key rate steady when the committee feels policy is in a good place, or if they’re waiting for more economic data.
Consumer price inflation surged from 2.4% in February to 4.2% in May, driven in part by elevated gas prices tied to the Iran war, but slowed to 3.5% last month amid a short-lived cease-fire. While “core” inflation, which excludes volatile food and energy prices, also fell last month, some economists expect inflation will shoot back up given renewed U.S.-Iran hostilities.
The Fed often looks through supply shocks like oil market disruptions, but some analysts feel leaving rates unchanged would risk the Fed’s credibility, given Warsh’s hardline stance against inflation.
The target range for the federal funds rate stands at 3.5% to 3.75%. Policymakers will unveil their rate decision at 2 p.m. ET, and Warsh’s news conference is scheduled to begin at 2:30 p.m. ET.
Economists expect no rate change
08:06 AM ET, July 29 2026, Rachel BarberAs Fed policymakers headed into their July meeting in the morning on July 28, traders were split with about 69% expecting no rate move and about 31% anticipating a quarter-point hike, according to CME FedWatch.
Economists were more aligned. Oxford Economics, KPMG Economics, and Bank of America economists expect no rate change after the July meeting. All 104 forecasters surveyed by Reuters also predicted the Fed would leave its target range for rates unchanged at 3.5% to 3.75% this month.
What time is the Fed rate decision today?
08:04 AM ET, July 29 2026, Rachel BarberAfter the second day of the Federal Open Market Committee's July meeting, policymakers are expected to release their rate decision at 2 p.m. ET. Warsh’s news conference is scheduled to follow at 2:30 p.m. ET.
This article originally appeared on USA TODAY: Interest rate decision updates: Fed weighs whether to hike or hold
