Divided Federal Reserve keeps interest rates steady

The Federal Reserve on Wednesday opted to keep its benchmark interest rate at a range between 3.5% and 3.75%. Eight members of the rate-setting Federal Open Market Committee, including chairman Jerome Powell, voted against cutting rates. But in a rare move for the committee, four of its members voted against the statement announcing the decision.

The majority said they voted to leave rates steady due to persistent high inflation, low job gains, and ongoing energy crisis resulting from the current conflict in the Middle East. The last time that the Federal Reserve cut its rates was in December 2025.

What did the dissenting committee members want? Stephen Miran was one of the committee members who opposed the Wednesday decision. He wanted to lower the rates by one-fourth of a percentage point, according to the committee’s statement. The three other dissenting members agreed with the decision to leave rates steady, but voted against the committee’s statement because they felt its language indicated that rate cuts would resume soon.

Did Powell indicate whether he would remain a Federal Reserve governor once his term as chairman ends on May 15? Powell would stay a governor, at least until the Justice Department completely concluded its investigation into Federal Reserve renovation costs, he said. He planned to keep a low profile and respect the new chairman, he said. The Senate still has to confirm President Donald Trump’s pick to succeed Powell, former Fed governor Kevin Warsh.

Dig deeper: Read Liz Lykins’ story on Warsh’s nomination for more information.