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Federal Reserve expected to keep rates unchanged for now despite high prices
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Federal Reserve leaves interest rate unchanged in 9-3 voteWASHINGTON -- The Federal Reserve left its key interest rate unchanged Wednesday despite persistently high inflation and a spike in energy prices caused by the Iran war.
Dissenting in favor of a quarter-point interest rate hike were Beth Hammack, president of the Federal Reserve Bank of Cleveland; Neel Kashkari, president of the Minneapolis Fed; and Lorie Logan, president of the Dallas Fed.
The Iran war has generated uncertainty over the economic outlook and has driven energy prices higher, intensifying inflationary pressure and creating a quandary for Fed policymakers.
That caused the greatest disruption in oil supplies in history and sent energy prices surging.
So-called core inflation - which excludes volatile food and energy prices - cooled in June, partly because apartment rents aren't rising as fast as they had been.