Fed Holds Interest Rates at 3.5-3.75% in Powell's Final Meeting
Al Jazeera Staff
The U.S. Federal Reserve maintained its benchmark interest rate at 3.5-3.75% during Chair Jerome Powell's final policy meeting, citing inflationary pressures from the Middle East conflict and a sluggish labor market. The decision was widely expected, with 100% of investors forecasting no change.
The U.S. Federal Reserve has decided to hold interest rates steady at 3.5-3.75% amid rising inflation and labor market pressures from the U.S.-Israel military campaign against Iran, which continues to strain the global economy.
The decision was announced on April 29 (local time) following a two-day policy meeting, coinciding with the end of Chair Jerome Powell's term. This was his last meeting before handing over to a successor.
Data from CME FedWatch, a tool tracking monetary policy change probabilities, showed 100% of investors expected the Fed to hold rates at this meeting.
Inflationary pressure from oil markets and a sluggish labor market were key factors influencing the central bank's decision. The U.S. Labor Department is expected to release its latest jobs report next week.
“Developments in the Middle East are contributing to a high degree of uncertainty about the economic outlook,” the Fed said in a statement. “Job growth remains low on average, and the unemployment rate has been largely unchanged in recent months. Inflation remains elevated, partly reflecting a recent surge in global energy prices.”
The decision came on the same day the Senate Banking Committee confirmed the nomination of Kevin Warsh, selected by President Trump to replace Jerome Powell. The party-line vote sent Warsh's nomination to the full Senate for approval.
