Fed holds 3.50%-3.75%; 3 FOMC voters push for 25 bps hike

3.50%-3.75% remains the U.S. federal funds target range after the Federal Open Market Committee’s July 29 decision. The Federal Reserve statement recorded a 9-3 vote, making the dissent count the market-moving detail rather than the hold itself.

The three dissenters were Beth M. Hammack, Neel Kashkari and Lorie K. Logan. All three preferred to raise the target range by 25 bps at the meeting. That split matters for rates markets because the June decision had been unanimous, while the July statement kept policy unchanged but made the inflation debate visible inside the voting record.

Item | July 29 decision
Target range | 3.50%-3.75%
Vote | 9-3
Dissent preference | 25 bps hike
Inflation goal | 2%

The statement tied the decision to a solid pace of economic activity, strong productivity growth and capital investment, and job gains that have kept pace with the workforce. It also said inflation remains elevated relative to the 2% goal, partly because supply shocks have lifted prices in sectors including energy.

The finance signal is a central-bank action with a sharper internal split. A steady target range keeps overnight funding costs unchanged, but three votes for tightening raise the weight of incoming inflation and employment data before the September meeting. Treasury yields, the dollar and rate-sensitive equities will trade less on the word “hold” and more on whether the next PCE and labor-market readings validate the dissenters.