Good Wednesday evening. In this edition: Fed holds interest rates steady, announces changes to meeting schedule.
Plus, Peltola, Iran war and Huerta.
Federal Reserve
The Federal Reserve voted to leave interest rates unchanged in its final monetary policy decision before the midterm elections despite "elevated" inflation.
The decision keeps the target range for the federal funds rate at 3.75%-4%, where it has stood since policymakers approved a quarter-point increase in September, the first rate hike since July 2023.
Two of the 12 voting members of the Federal Open Market Committee (FOMC) dissented, with Governor Lisa Cook and Cleveland Fed President Beth Hammack favoring another quarter-point increase.
Federal Reserve Chair Kevin Warsh said employment conditions remained positive, but inflation continued to weigh on American households and was a central focus of policymakers' discussions over the past two days.
"On the employment side of the Fed's dual mandate, conditions are quite positive. And yet Americans, of course, are still dealing with inflation that has been running above the committee's objective for close to six years. It's our responsibility to get inflation down," he said at a news conference.
Chair Warsh said last month's rate increase was beginning to take hold in the economy, and portrayed the decision to keep rates steady as an opportunity to assess additional economic data before taking further action.
"We have started to see some changes in financial and credit conditions. They have tightened for some businesses and households, much as we would expect," he said. "Market participants are becoming somewhat more discerning in their capital allocations."
The Fed chair dismissed suggestions that the upcoming midterm elections influenced the committee's decision to hold rates steady, saying politics played "no role" in its deliberations.
"Politics played no role in the decision," he told reporters. "I didn't hear a reference to politics, elections, what's happening in the next week or so."
Chair Warsh also announced a significant change to the Fed's meeting schedule, saying the FOMC will hold fewer interest rate-setting meetings beginning next year.
The committee will continue meeting eight times annually, but one meeting in 2027 and two in 2028 will focus "exclusively on broad monetary policy strategy" and will not include votes on interest rates.
The FOMC has held eight scheduled meetings a year since 1981, but Chair Warsh began discussing a reduction in rate-setting meetings in July, arguing that longer intervals would allow policymakers to gather more economic data between decisions.
"Getting policy right involves assessing near-term developments at timely, regular and information-rich intervals," he said. "But it's equally important we reserve time and space as an intellectually diverse group for strategic deliberations, for thinking anew about big questions, looking out over longer time horizons."
The Fed's next scheduled monetary policy meeting is Dec. 8-9, with investors expecting another 25-basis-point increase, according to CME FedWatch.
Following Wednesday's decision, markets priced in an approximately 78% chance of a quarter-point rate hike in December.
Stocks edged higher for the third consecutive day, with the S&P 500 gaining 0.3% and the Dow Jones Industrial Average rising 0.2%.
A New York Timesinvestigation found that members of Alaska Democratic Senate candidate Mary Peltola's campaign were involved in efforts to recruit another "Dan Sullivan" to enter the race in hopes of drawing votes from Sen. Dan Sullivan (R-AK). Her campaign reiterated its denial of involvement following the report's publication Wednesday. The Justice Department filed a lawsuit last week seeking to block certification of the results if Sen. Sullivan loses by fewer votes than the other Sullivan receives, citing concerns about voter confusion. President Trump called for Ms. Peltola to withdraw and face criminal prosecution following the report. "I think they should be prosecuted," he told reporters. "To me, that's voter fraud at the highest level." Recruiting a candidate with the same name as an opponent is generally considered legal.
The Iran war has cost the U.S. military at least $47.1 billion through mid-October, according to a new Pentagon estimate provided to Congress. The figure is up $3.5 billion since early September, despite a lull in major combat operations. The estimate includes approximately $29 billion to replace expended munitions, $6.1 billion for lost equipment and $11.9 billion in additional operational costs. It does not include the cost of repairing U.S. military bases damaged by Iranian missile and drone attacks. The latest figures come as the Trump administration seeks billions in additional military funding and President Trump raises the possibility of resuming strikes against Iran after next week's midterm elections. The Congressional Budget Office has estimated the war could cost an additional $2 billion to $3 billion per month as it continues.
Dolores Huerta, the migrant workers’ rights leader who co-founded the United Farm Workers labor union with Cesar Chavez, has died at the age of 96. Ms. Huerta, whose cause of death was cancer, was a leading figure in the American labor and civil rights movements, helping organize farmworkers and fight for better wages, working conditions and protections for agricultural workers. She served as the union’s vice president for nearly four decades and is credited with popularizing the slogan "Si, se puede," or "Yes, we can." President Obama awarded her the Presidential Medal of Freedom, the nation's highest civilian honor, in 2012.
For your radar…
Former President Obama campaigns Wednesday for Democratic candidates in Morrow, Georgia. Watch LIVE on C-SPAN at 6:30pm ET.
President Trump campaigns Wednesday for Republican candidates in Chillicothe, Ohio. Watch LIVE on C-SPAN2 at 7pm ET.
C-SPAN is on YouTube. Subscribe today for live coverage, consequential moments, memorable exchanges and the political events everyone will be talking about.
