Warsh plans fewer Fed rate-setting meetings to make room for broader economic debate

Federal Reserve Chair Kevin Warsh said Wednesday, October 28, that the US central bank plans to devote some of its scheduled meetings to broader economic questions instead of votes on interest rates, NBC News reported. The change would alter a calendar closely watched by investors for decisions that affect borrowing costs across the economy.

Under the plan described by Warsh, one of the Fed’s eight annual meetings will take that broader focus starting next fall. The number will rise to two in 2028. NBC reported that the Federal Open Market Committee has held eight scheduled meetings each year since 1981; the plan changes what some meetings are for, rather than the stated annual total.

Why Warsh wants longer-term discussions

The proposal follows an earlier debate about whether fewer rate-setting meetings would leave the Fed less able to respond to sudden economic changes, NBC reported. According to NBC’s account of committee minutes, Warsh argued in July that a longer interval between rate-setting meetings would allow officials to gather more data before deciding on policy. That trade-off matters because the committee must weigh fresh evidence against the ability to act promptly when conditions change.

The October rate decision

The calendar announcement came on the day the Fed kept its key interest rate unchanged at about 3.9%, according to Associated Press reporting republished by PBS News. In its statement after a two-day policy meeting, the Fed said inflation remained elevated and that holding rates would allow it to accumulate more information before deciding how to return inflation to its 2% target.

The decision was not unanimous. Fed governor Lisa Cook and Cleveland Fed President Beth Hammack voted for a quarter-point increase, the AP reported. Their dissent shows the immediate rate choice remained contested even as Warsh set out a longer-term change to how the committee uses its scheduled meetings. The Fed gave little indication of its next rate move in the policy announcement, according to the AP account.