Three FOMC regional Fed presidents back 25-basis-point hike in first triple dissent since 2016

The Federal Reserve kept its benchmark rate unchanged at 3.50%-3.75% after the Federal Open Market Committee voted 9-3 to hold policy steady for a fifth straight meeting, with Beth Hammack, Neel Kashkari and Lorie Logan dissenting in favor of a 25-basis-point increase. The split highlighted rising internal pressure to tighten policy as inflation remains above the Fed's 2% target. After the meeting, Chair Kevin Warsh unsettled markets by stressing the need to bring inflation down without signaling an imminent rate increase and by suggesting the Fed could revisit its policy framework after next January, while keeping the current 2% Personal Consumption Expenditures Price Index target in place for now. Richmond Fed President Tom Barkin later said the current stance is "a close call": he saw "a strong case" for adding restraint and reversing some of last year's rate cuts, but said softer June inflation also supports waiting until upcoming meetings to judge whether policy is already restrictive enough. Treasury yields rose sharply after the meeting, with the 30-year yield moving above 5.2%, a 19-year high, as investors questioned the Fed's inflation-fighting resolve. June PCE inflation eased to 3.7% from 4.1% in May, while core inflation edged down to 3.3% from 3.4%, leaving policymakers divided ahead of the Fed's next meeting in mid-September.