Fed officials are set to keep rates at a range between 3.50 per cent and 3.75 per cent, extending their pause on cuts since the start of the year.
Their decision will be announced on Wednesday after the two-day meeting. They will also release their quarterly Summary of Economic Projections, which includes guidance on growth, inflation and interest-rate expectations.
All eyes will be on the language the Fed uses to communicate the decision, with at least four of 12 voting members now in favour of indicating a rate hike could be as likely as a cut for the central bank’s next move.
With inflation at a three-year high and a firming labour market, pressure has been increasing for the Fed to address rising prices by potentially raising interest rates.
Such a move, however, would be sure to anger US President Donald Trump, who has exerted unprecedented pressure on the Fed since taking office for his second term.
Trump’s Justice Department has pursued criminal charges against Warsh’s predecessor Jerome Powell – who he routinely insulted and criticised. That probe was later dropped.
In an unusual move, Powell chose not to resign from the board when his tenure as chairman ended, citing threats to the Fed’s independence.
He is expected to remain on as a governor until January 2028.
Separately, Trump has tried to unseat Fed Governor Lisa Cook on mortgage fraud allegations, with the Supreme Court due to rule on the legality of that move.