Fed Holds Rates Steady Amid High Inflation Concerns

The Federal Reserve kept interest rates steady at 3.5-3.75% despite high inflation, but left room for future rate hikes if price increases persist.

The decision was made by a vote of 9 to 3, with three regional Fed bank presidents dissenting from the decision to keep rates unchanged.

The central bank's chairman, Kevin Warsh, emphasized that policymakers have 'no tolerance' for high inflation and are determined to restore price stability after five years of uncomfortably high prices.

The annual inflation rate stood at 4.2% in May, its highest level in over three years, driven by a spike in gasoline prices due to the US war with Iran.