Overview

• The Federal Reserve left its benchmark rate unchanged at 4.25%–4.50% at the July 31 meeting.
• Two governors, Michelle Bowman and Christopher Waller, dissented, advocating a 0.25 percentage point rate cut and marking the first multi-member split since 1993.
• Chair Jerome Powell said restrictive policy is not unduly slowing the economy and underscored a data-dependent approach for future decisions.
• Official figures showed second-quarter GDP expanded at a 3% annualized rate, rebounding from a 0.5% contraction in Q1 even as planned tariffs threaten to sustain inflationary pressures.
• Markets responded by pushing up short-term Treasury yields and strengthening the dollar as traders cut their odds of a September rate reduction.