I=7 Fed officials divided on where interest rates should go with several policymakers suggesting the fed may need to raise interest rates if inflation stays above their target, minutes show
Fed minutes indicate participants were divided on where the policy should head.
“Some participants commented that it would likely be appropriate to hold the policy rate steady for some time as the Committee carefully assesses incoming data, and a number of these participants judged that additional policy easing may not be warranted until there was clear indication that the progress of disinflation was firmly back on track.”
Several participants wanted the post-meeting statement to reflect a two-sided description of future monetary policy path.
“Several participants indicated that they would have supported a two-sided description of the Committee’s future interest rate decisions, reflecting the possibility that upward adjustments to the target range for the federal funds rate could be appropriate if inflation remains at above-target levels.”
I=7 Fed keeps interest rate unchanged in the range of 3.5%-3.75% as was widely expected by the market but maintained projections for one rate cut this year
The post statement said “has been little changed in recent months” replacing the January statement which said unemployment rate “has shown some signs of stabilization”.
The statement reiterated that the economic activity has been expanding at a solid pace but pointed out that the impact of Iran conflict on the U.S. economy is uncertain.
Polycymakers raised their outlook for growth in 2026 to 2.4%, from the 2.3% they forecast in December, left unemployment rate forecast for 2026 at 4.4% and raised their outlook for 2026 inflation to 2.7% from 2.4%.
Stephen I. Miran was the only dissent, prefering a rate cut of 25 basis points.
I=8 DOJ drops criminal investigations of Federal Reserve Chair Jerome Powell, removing major hurdle for Kevin Warsh confirmation
Sen. Thom Tillis, a North Carolina Republican, had put an effective hold on the Senate confirming Warsh unless the criminal investigation of Powell was dropped.
Jeanine Pirro, the prosecutor who was in charge of the investigation said the DOJ was dropping the investigation since the Fed’s inspector general has been tasked to carry out the probe.
“Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry. Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so,” she said.
Powell’s term ends on May 15, leaving roughly three weeks for Warsh’s confirmation, enough time given that past confirmations have often taken just a few days.
I=7 Fed keeps interest rate unchanged in the range of 3.5%-3.75% as was widely expected by the market, three mebers dissent the inclusion of an easing bias
There were no major changes to the post-meeting statement other than the inclusion of the statement saying the developments in the Middle East are creating uncertainty on the economic outlook.
The policy decision had four dissents, the highest level since 1992, with Stephen Miran preferring a 25 basis points rate cut and Beth Hammack, Neel Kashkari, and Lorie Logan against the inclusion of an easing bias in the statement (but supporting the hold).
“Job gains have remained low, on average, and the unemployment rate has been little changed in recent months. Inflation is elevated, in part reflecting the recent increase in global energy prices,” the statement reads.
I=6 Fed Chair Jerome Powell said he will stayon the Board of Governors after his term as Chair ends next month, denying Trump majority in the board
By staying on, Powell will be denying President Trump the majority in the fed’s board.
“The things that have happened really in the last three months have, I think, left me no choice but to stay until I see them through at least that long,” Powell said.
