“Fed Interest Meeting: Kevin Warsh Raises Rates Despite Trump’s Desires”

What actually happened

The Federal Open Market Committee met September 15-16 and voted to raise the federal funds target range by a quarter point. Kevin Warsh, in his first hike as chair, cited inflation running well above the Fed's 2 percent target alongside a resilient economy as the basis for the decision, while explicitly framing it as data-driven rather than a response to markets or the White House.

Key facts

• The Fed raised its benchmark interest rate by a quarter percentage point, taking the federal funds target range from 3.50-3.75 percent to 3.75-4.00 percent, the first increase since 2023.
• The committee voted unanimously to raise the federal funds target range by a quarter percentage point.
• Warsh said the latest inflation readings suggested total PCE inflation was around 3.6 percent in August, with core PCE inflation around 3.2 percent, both above the Fed's 2 percent target.
• Trump has repeatedly called for lower interest rates, arguing that the United States should have cheaper borrowing costs, saying days before the meeting the country "should be paying the lowest interest rate in the world."
• The president does not set the federal funds rate; monetary policy is determined by the FOMC, which Warsh chairs.

What to watch for

Watch whether Trump escalates rhetoric or follows through on his threat of tariffs tied to Fed policy, and whether the next PCE print shows inflation cooling toward target, which would validate or undercut Warsh's rationale. Also worth tracking is whether future hikes remain unanimous or expose the kind of split (Waller had signaled a preference to hold) flagged before the meeting.