U.S. Central Bank Holds Rates Flat; Split Emerges With Two Dissenters.

Fed Holds Rates Steady as Expected; Two Officials Push for Cut in Rare Split Decision

The U.S. Federal Reserve kept its benchmark interest rate unchanged at 4.25%–4.50% on Wednesday, a move broadly anticipated by markets. However, the policy decision came with a rare divergence: two Fed governors dissented, advocating for a rate cut.

Michelle Bowman and Christopher Waller voted in favor of a 25 basis point reduction—marking the first dual dissent on monetary policy since December 1993, according to Carson Group strategist Ryan Detrick. Their stance highlights growing internal debate over the appropriate path for interest rates amid a slowing economic backdrop.

“While fluctuations in net exports continue to influence data, recent indicators suggest that economic growth moderated in the first half of the year,” the Fed said in its post-meeting statement. “The labor market remains strong, with low unemployment, though inflation continues to run above target.”

Markets were largely unmoved following the announcement. Bitcoin (BTC) edged down 0.5% to $117,400, while the S&P 500 and Nasdaq gave back modest intraday gains.

Traders had overwhelmingly priced in a rate hold. On the blockchain-based prediction platform Polymarket, a trader operating under the alias “Spice” had staked nearly $1.3 million on the Fed standing pat—betting on a high-probability, low-return scenario. The position was later trimmed to $724,000 just ahead of the announcement.

Attention now turns to Fed Chair Jerome Powell’s remarks at 2:30 p.m. ET, where markets will look for signals about the central bank’s next move in September. Powell has so far resisted political pressure—including calls from President Trump—to ease monetary policy amid lingering inflation concerns.

Ahead of the meeting, CME FedWatch data showed a roughly 60% chance of a rate cut at the Fed’s next meeting, a probability likely to shift depending on Powell’s tone and guidance during his press conference.