Fed Holds Rates with 3 Dissents, Dow Plunges 1,153 Points

The U.S. Federal Reserve on Wednesday kept its benchmark interest rate unchanged at 3.5% to 3.75% for a fifth consecutive meeting, despite rising internal divisions. The Federal Open Market Committee voted 9-3, with Cleveland Fed President Beth Hammack, Minneapolis Fed President Neel Kashkari and Dallas Fed President Lorie Logan favoring a 25-basis-point increase, citing still-elevated inflation and risks to achieving the 2% target. Chair Kevin Warsh said market rates had already tightened financial conditions and reaffirmed the Fed’s firm 2% inflation goal. The decision came as an Iranian strike escalated Middle East tensions, lifted Brent crude above $90, and drove a sharp stock sell-off, with the Dow falling 1,153 points.