Fed Holds Rates Steady Amid Persistent Inflation Risks

The US Federal Reserve (Fed) is set to hold its second policy meeting under Chair Kevin Warsh, and markets expect interest rates to remain unchanged due to persistent inflation risks.

The Fed's open market committee will announce its decision on Wednesday at 2 p.m. GMT, followed by a news conference with Warsh.

Investors are expecting the Fed to keep rates steady at 3.50%-3.75% for the fifth straight meeting, according to CME's FedWatch monitoring tool.

The US consumer inflation rate eased to 3.5% on an annual basis last month, but remains far higher than the Fed's long-term target of 2%, which it has not achieved in over five years.

The ongoing conflict between the US and Iran, including intense strikes and retaliatory action targeting Washington's allies, has sent energy prices soaring to a high of $100 per barrel for the first time since late May.