Fed expected to leave rates unchanged next month after soft inflation data

Fed policymakers voted 9-3 last month to leave the U.S. central bank's benchmark interest rate in the 3.50%-3.75% range, where it has been since December.

In the two weeks since that decision, the three dissenters at that meeting and a couple of other Fed regional bank presidents who do not have a vote this year on policy have made the case for a rate hike given still-too-high inflation.

John Williams, the influential head of the New York Fed, has said he expects inflation to continue to ease as the effects of last year's tariff increases and the Middle East war abate, allowing the central bank to keep its policy rate unchanged.

Fed Chairman Kevin Warsh has said little about what would move him to support a change in the policy rate.

"Without forward guidance, the September decision will likely remain a close call until the very end," Olu Sonola, head of U.S. economics at Fitch Ratings, wrote in a note. "It will not be a slam dunk: whether it is a hold or a hike, both hawks and doves will find enough in the data to make their case."