For the first time since 1992, a Fed governor and president dissented together, as Kevin Warsh says the ‘monetary medicine’ is starting to work

The Federal Open Market Committee voted 10-2 to keep its benchmark federal funds rate at 3.75% to 4%, six days before the midterm elections. Governor Lisa Cook, whom President Trump has tried to remove, and Cleveland Fed President Beth Hammack both preferred to raise the target range by 1/4 percentage point, according to the Fed's statement. The vote carried two notable firsts: it was Cook's first dissent since she joined the Board of Governors in 2022, and it was the first time since October 1992 that a governor and a regional bank president dissented on the same side. In that earlier episode, Governor Lawrence Lindsey and Cleveland Fed President Jerry Jordan sought an immediate rate cut, while Governor John LaWare and St. Louis Fed President Thomas Melzer dissented on the opposite side, according to Fed records cited in the report.

Fed records show that governors have largely stopped dissenting since the early 1990s, and when dissents have occurred alongside presidents, they have usually been on opposite sides. In October 2025, Governor Stephen Miran pushed for a larger cut while Kansas City Fed President Jeff Schmid opposed any cut. Laura Ullrich, director of economic research for North America at the Indeed Hiring Lab and a former Richmond Fed staffer, said that Hammack's vote did not surprise her, as Hammack had outlined her views at a Cleveland conference two weeks earlier, but that Cook's dissent was more surprising.

At the press conference, Chair Kevin Warsh said the committee opted to wait and assess incoming data. He stated that "the overwhelming consensus is that what we've done in this monetary medicine is starting to work some, but there is no firm conclusions." The Fed kept its view that "inflation remains elevated" but upgraded its assessment of economic activity to "expanding at a strong pace." Consumer prices rose 3.7% from a year earlier in September. Before the decision, CME Group's FedWatch tool showed a 78% probability of a December hike. Ullrich said she expects a hike is likely and that the probability is "very, very high," noting that inflation data has worsened since the last meeting.

Aubrey Woessner, associate economist at the Indeed Hiring Lab, said the decision was difficult to reconcile with the Fed's repeated pledge over the past five months to restore price stability, adding that whether the public believes the Fed will bring inflation down in a timely manner matters for everyone. Ullrich said inflation expectations have been edging up, though they have remained well anchored, and that the literature shows inflation tends to follow rising expectations. On the labor market, Ullrich noted that Indeed's job postings index turned positive year over year in mid-September for the first time in four years, but said the economy remains in a "low hire, low fire environment."