FOMC Sees First Dual Dissent Since 1993 Over Rate Policy

Key Insights:

• For the first time in 30 years since 1993, there’s a dual dissent in the Fed opposing chairman Jerome Powell’s policies.
• Fed Chair Jerome Powell warned that Trump-era tariffs are beginning to push up consumer prices, signaling potential inflation pressure.
• Following the meeting, President Trump accused Powell of damaging the U.S. economy through delayed policy actions.

Concluding the latest Federal Open Market Committee (FOMC) meeting on Wednesday, July 30, Fed Chair Jerome Powell decided to keep interest rates unchanged at 4.25%–4.5%. While this was quite on the expected lines, market analysts point out strong dissent among Fed governors and that Powell has been dragging the line for too long. For now, Powell has decided to stay on the ground at the latest FOMC meeting, despite continuous pressure from the Trump administration, seeking his resignation.

FOMC Reveals Cracks and Dissent Among Fed Governors

The latest FOMC meeting reveals some cracks and dissent happening within the Federal Reserve. However, the decision revealed rare internal disagreement, as Governors Christopher Waller and Michelle Bowman voted to cut rates by 25 basis points. It marks the first dual dissent among Fed governors since 1993.

According to Juan Leon, Senior Investment Strategist at Bitwise, Fed Chair Jerome Powell emphasized that a “modestly restrictive” policy remains appropriate. This has further pushed the market odds of a September rate cut below 50%.

Powell has left the door open for keeping the interest rates unchanged during the September FOMC meeting. The Fed chair added that the decision will depend on economic data released over the coming two months. “We have made no decisions about September, we don’t do that in advance,” he said.

Jerome Powell Said Trump Tariffs are Driving Inflation

Fed Chair Jerome Powell stated that inflation is likely to rise higher in the coming months amid Trump tariffs. In his post-FOMC remarks, Powell stated that they have already started to witness the impact of tariff-related inflation on the US economy. He noted that inflation could trend higher in the coming months, especially if reciprocal tariffs are implemented after the August 1 deadline.

Commenting specifically on the Trump-era tariffs, Powell stated that it would be too early to assess their early impact. However, he added that the consumer price surge is already showing some impact. Powell emphasized that the Fed will need to monitor developments closely and respond based on incoming data.

On the timing of potential monetary easing, Powell said it remains uncertain whether economic data will offer clear guidance by the September FOMC meeting. He stressed that the Fed’s priority is to ensure that future rate cuts are appropriately timed.

Yesterday’s FOMC meeting led to a knee-jerk reaction in the crypto market with Bitcoin price plunging under $116,000 for a while. “The first move after the FOMC is almost always a fake move on Bitcoin and altcoins. It traps everyone, and then it rotates the other way around,” said crypto analyst Michael van de Poppe.

President Trump Slams Powell After FOMC Meeting

Fed Chair Jerome Powell has been facing mounting pressure over the past few weeks from the Trump administration for his resignation. On several instances, President Trump has also asked Powell to resign for refusing to cut rates.

Besides, President Trump is demanding a 100-bps rate cut in order to kickstart the US economy’s growth engine. Following yesterday’s FOMC meeting, Trump wrote on Truth Social:

Powell’s tenure is ending next year in May 2026. Some analysts believe that he would stay up to the end of his tenure.

Disclaimer

This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.