Fed Maintains Rate Range of 3.50%-3.75% in Powell's Last Meeting 📰💰💵

Powell’s last monetary policy meeting saw Fed maintain rates as threats of inflation collide with weak growth. Powell steps down on May 15 while Kevin Warsh will replace him.

Rate Decision Highlights

* Rate decision: Fed maintains its rate range at 3.50%-3.75%

* Reasoning: Balancing inflation pressures with evidence of slowing growth

* Fed statement: Will “carefully evaluate the information…in the coming months” before making any moves

Four Dissenters Portend Tension at the FOMC

* Dovish: Stephen Mirran dissented saying Fed should cut interest by 25 basis points

* Hawkish: Beth Hammack, Neel Kashkari, Lorie Logan dissented saying Fed should do nothing

* Significance: Three hawkish dissents show it may be tough for Warsh to get interest rates lowered

Changes in Leadership

* Powell’s End: Possibly his last meeting as the chair. Term expires on May 15.

* Warsh Takes Over: Passes Senate Banking Committee vote on Wednesday. He is expected to take the chair position when Powell resigns.

* Upcoming Event: Powell’s presser to hint on interest rates going forward.

Market Reaction

* Cryptocurrency: BTC -0.5% in 24hr, selling near $76,000 mark.

* Equity Markets: Nasdaq falls by 0.35%. Stocks show minor losses.

* Yields: 2-year yields rise by 9 bps to 3.93%, and 10-year yields rise by 5 bps to 4.40%.

* Crude Oil Prices: Near all-time high level at ∼$105/barrel following rebound in Iran.

Fed’s Dilemma

Rising fuel prices increase headline inflation but hamper growth. This creates a dilemma for the Fed.

#FederalReserve #JeromePowell #KevinWarsh #InterestRates #MonetaryPolicy