Will the Fed cut rates? Here's what to expect at Wednesday's meeting.
Summary
The Federal Reserve is expected to keep interest rates unchanged at its meeting on Wednesday because inflation remains high and the job market is stable but not strong. Jerome Powell will hold his final meeting as Fed chair before being replaced by Kevin Warsh, whose nomination is moving forward after an investigation into Powell concluded.Key Facts
- The Fed will announce its interest rate decision at 2 p.m. ET on Wednesday, followed by a press conference at 2:30 p.m. led by Jerome Powell.
- Economists agree the Fed will keep rates steady between 3.5% and 3.75%, the same level since December 2025.
- Inflation reached 3.3% in March, the highest since May 2024, above the Fed’s target of 2%.
- The Fed has a dual goal to keep inflation low and maintain a strong job market.
- The job market is steady but not growing fast, with employers neither hiring much nor laying workers off.
- Jerome Powell will step down as Fed chair on May 15 after eight years.
- Kevin Warsh is expected to replace Powell, with his nomination progressing after the end of a legal probe into Powell’s office renovation.
- Some economists expect the Fed might cut rates later in 2026, possibly in September or December.
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