Federal Reserve Chair Kevin Warsh skips his dot projection, while the committee’s median forecast points to a quarter-point rate increase later this year.
The Federal Reserve left its benchmark interest rate unchanged at 3.5%-3.75% in Kevin Warsh’s first meeting as chair, but the updated dot plot revealed a split committee leaning toward a hike. The Federal Open Market Committee’s median projection now signals a quarter-point increase by year-end, with a 9-9 divide between those expecting steady rates or a cut and those anticipating at least one hike.
Warsh declined to submit his own rate projection, breaking from tradition and citing long-standing skepticism of forward guidance. The dot plot, however, still reflected a hawkish tilt among policymakers, contrasting with earlier market expectations for a more dovish stance. The decision followed no dissents on the current rate hold.
Markets reacted negatively, with major averages declining as Warsh’s press conference underscored uncertainty about future policy moves. The Fed also announced plans to review its policy framework, hinting at potential structural changes ahead.