Fed third meeting of 2026: Final Powell decision, rates likely unchanged
&imwidth=600&imheight=450&format=webp&quality=medium "Fed third meeting of 2026: Final Powell decision, rates likely unchanged")
This combination of pictures created on April 15, 2026 shows (L/R) US Federal Reserve Board Chairman Jerome Powell in Washington, DC, on December 10, 2025 and US President Donald Trump at the White House in Washington, DC, on April 13, 2026. Photograph: (AFP)
The Federal Reserve begins its two-day meeting, likely holding rates steady as Jerome Powell prepares to step down and Kevin Warsh takes over.
The Federal Reserve's policy-making committee began its scheduled two-day meeting today, Tuesday, April 28, 2026. This is widely expected to be the final meeting of Jerome Powell as Fed Chair after eight years at the helm. The committee will announce its third-rate decision of 2026 on Wednesday. He will be replaced by Trump's nominee Kevin Warsh on May 15.
What to expect from the Fed's meeting?
The overwhelming consensus from the economists is that the Federal Open Market Committee, or FOMC, will hold rates steady, within its current range of 3.5 per cent to 3.75 per cent. While the Fed's own projections earlier this year signalled a single 0.25 per cent rate cut sometime in 2026, recent geopolitical and economic shocks have made that less certain. The war in West Asia has pushed energy prices and inflation to their highest level in almost two years. With Brent crude near $110 per barrel, analysts from StoneX report that markets now see only a 35% chance of even one rate cut this year.
"The FOMC is likely to reiterate its wait-and-see message at its April meeting this week because the war with Iran continues to cloud the economic outlook and to present risks to both inflation and activity," said economists at Goldman Sachs. While a rate cut would make it easier for US consumers to borrow easily, it would push inflation even higher, which would be pushed into all other economies. It seems extremely unlikely as officials confront a lacklustre job market. However, a rate cut might help businesses to hire more workers, but the job market is not in that dire need of a push that they would risk further inflation. "The labour market is plugging along without much steam, but it's still plugging along," said Elizabeth Renter, a senior analyst at NerdWallet, to CBS News. The CPI Index for March was at 3.3 per cent on an annual basis, well above the Fed's target rate of 2 per cent, and the highest since May 2024.
Kevin Warsh to deliver Trump's rate cut?
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Trump's nominee, Warsh, says that he is looking for a "good family fight" at the policy-making table once he takes over the US central bank, as Trump is urging for an interest rate cut. Of the 19 Fed officials who set interest rates, about a third are solidly centrist, and only three have agreed to a near-term cut in borrowing rates. Warsh, at his confirmation hearing, did not reiterate his support for rate cuts, which he promised to deliver when US President Donald Trump was considering his nominee for the Fed Chair.
