Fed Holds Rates Steady Amid Dissent for First Time Since 1993

Central bank resists political pressure; strong GDP, Meta earnings drive markets.

TL;DR:

🏦 Fed holds rates; two governors dissent
📊 U.S. GDP grows 3% in Q2
🚀 Meta surges 11% on strong earnings
🌎 Canada, Mexico in urgent trade talks

🏦 Fed Holds Rates; Two Governors Dissent

The Federal Reserve kept its benchmark rate at 4.25%-4.5%, ignoring calls from President Trump for a cut. Notably, two Fed governors dissented—the first split vote on rates since 1993—signaling growing internal debate over policy direction. This move reinforced the Fed’s focus on inflation and independence, but also heightened market volatility as investors recalibrated rate cut expectations. Source

📊 U.S. GDP Grows 3% in Q2

U.S. GDP grew at a 3% annualized pace in the second quarter, exceeding most forecasts. The expansion was driven by lower imports and steady, if subdued, consumer spending. This solid growth print supported equities and further justified the Fed's decision to hold rates steady, although some analysts flagged underlying demand as “lukewarm.” Source

🚀 Meta Surges 11% on Strong Earnings

Meta shares jumped more than 11% after the company posted a 22% year-over-year revenue gain in Q2. The strong performance was attributed to robust ad demand and Mark Zuckerberg’s continued push into AI-driven products, boosting investor confidence and helping lift the broader tech sector. Source

🌎 Canada, Mexico in Urgent Trade Talks

With U.S. tariffs set to take effect, Canada and Mexico entered last-minute negotiations to head off steep trade penalties. The outcome of these talks could have significant implications for cross-border supply chains and market sentiment across North America. Source