Add Zee Business as a Preferred Source
End of an Era: Fed holds rates steady in Powell’s final review as Chair
Some policymakers at the Federal Open Market Committee (FOMC) -- the Federal Reserve's rate-deciding panel led by its chairman -- cited elevated levels of energy rates behind the decision to leave the cost of money steady, owing ot the West Asia crisis that has left the Strait of Hormuz effectively closed for about two months.
)
Jerome Powell took office as Fed Chair in 2018.
Written By: Sandeep Singh
Updated: Thu, Apr 30, 2026
01:00 AM IST
01:00 AM IST
New Delhi, ZeeBiz WebDesk
The Federal Reserve on Wednesday decided to leave the benchmark rate in the range of 3.5-3.75 per cent, marking a third straight status quo. The key American lending rate has remained at this level since early December. Some policymakers at the Federal Open Market Committee (FOMC) cited elevated energy prices behind the decision to keep borrowing costs steady, owing to the West Asia crisis that has left the Strait of Hormuz effectively closed for about two months.
The latest policy statement noted that “developments in the Middle East are contributing to a high level of uncertainty about the economic outlook.”
Almost unanimous decision to hold rates; one FOMC member favours cut
The decision by the FOMC -- chaired by Fed Chair Jerome Powell -- was nearly unanimous.
TRENDING NOW
Only Fed Governor Stephen Miran cast a vote in favour of monetary easing.
Jerome Powell’s last scheduled policy statement as Fed Chair
In his final policy review speech as Chair of the Fed, Powell said: “This is, and will be, a very normal, standard kind of transition process.”
Conveying his regards to Kevin Warsh, US President Donald Trump’s pick as his successor, the current Fed chief expressed confidence in the central bank’s core tenets.
Powell also said he had a “nice chat” with Warsh at a dinner in January, noting that he had not seen him since.
“This is my last press conference as chair, and I will close with a few thoughts,” he said in a customary post-review presser.
He congratulated Warsh on “his advancement out of the Senate Banking Committee this morning.”
“This is an important step forward,” Powell said, adding: “I wish him well as that process continues.”
He also noted that the Fed “exists for one fundamental purpose: to foster the economic conditions in which American families and businesses can thrive -- stable prices, a strong job market and a financial system they can depend on.”
Every decision by the Fed is made “in service of that purpose”, whether on interest rates or other issues.
Powell’s current term, which began in 2018, ends on May 15.
Who is Kevin Warsh?
Kevin Warsh, named by Trump as Powell’s successor, is widely seen as favouring additional rate cuts this year, according to foreign media reports.
His nomination is expected to advance to the broader Senate chamber for a final vote.
While Warsh may struggle to make a case for rate cuts this year, his leadership would still likely usher in a new era at the American central bank.
Currently, the Fed’s rate-setting panel meets eight times a year -- roughly once every six weeks.
Many experts believe Warsh’s regime could reduce the number of meetings.
Oil prices, inflationary pressure, Strait of Hormuz...
The third status quo in rates comes at a time when energy prices have neared a four-year high last seen in mid-March, when tensions peaked in the conflict between US-backed Israel and Iran.
The Strait of Hormuz -- a crucial maritime route connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea, and typically carrying one-fifth of the world’s oil and gas supply -- has remained effectively blocked amid escalating tensions.
On February 28, joint American-Israeli strikes on Tehran reportedly killed Iran’s Supreme Leader Ali Khamenei and triggered retaliatory action across the region.
Currently, the US and Iran are observing an indefinite ceasefire, while Israel and Lebanon have a temporary truce. However, a severe blockade persists in the Strait of Hormuz, with hopes of renewed talks dimming after recent discussions failed earlier this month.
The US president has said the next round of talks may be held over the telephone.
Wall Street Update | Dow and more
Wall Street began the day on a listless note and succumbed to selling pressure after the Fed's policy statement, which was along expected lines.
At the last count, the Dow Jones Industrial Average was down 281 points -- or 0.6 per cent -- and the S&P 500 was down 5 points -- or 0.1 per cent -- while the tech stocks-heavy Nasdaq Composite was barely in the green.
Brent crude was up 6.2 per cent at $110.9 per barrel.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
Sandeep Singh
Sandeep Singh
RECOMMENDED STORIES
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
Nifty, Sensex post second weekly loss as foreign fund outflows and weak global cues weigh on markets
Oil prices jump 2% to $68.45 on Iran-Israel ceasefire, US rate cut bets
Fed holds rates as US stagflation fears rise; will Indian stock markets feel the heat?
Mid-day market update: Markets stay flat; IT, PSU banks lead decline, auto stocks outperform
Fed June 2025 Meeting: Key things to watch out for as Jerome Powell-led FOMC kicks off 2-day deliberations
