The Federal Open Market Committee kept its target for the federal funds rate at 3.5 percent to 3.75 percent on July 29, choosing not to change borrowing conditions while it assessed inflation, employment and uncertainty surrounding the economic outlook.
The decision passed by a 9–3 vote. Beth Hammack, Neel Kashkari and Lorie Logan dissented because they preferred to increase the target range by one-quarter percentage point. The split showed that debate at the meeting centered partly on whether inflation risks justified an immediate increase, although the adopted policy left the existing range in place.
In its statement, the committee described economic activity as expanding at a solid pace despite elevated uncertainty related in part to the conflict in the Middle East. It said productivity growth and capital investment were strong, job gains had kept pace with the workforce and the unemployment rate had changed little.
The committee also said inflation remained above its 2 percent objective, with supply shocks contributing to price increases in sectors including energy. The statement did not commit to a particular action at the next meeting or provide a promised path for interest rates.
An accompanying implementation note kept the interest rate paid on reserve balances at 3.65 percent, effective July 30. The standing overnight repurchase-agreement rate remained 3.75 percent, while the standing overnight reverse-repurchase offering rate remained 3.5 percent with a limit of $160 billion per counterparty per day.
The statement gives a current policy decision, not a fixed forecast. Future choices can depend on incoming evidence about prices, employment, financial conditions and the economic effects of supply disruptions. The three dissents document meaningful disagreement at this meeting, but they do not predetermine how those or other committee participants will vote later.