Fed meeting live updates: Federal Reserve holds rates steady, traders await Powell’s final presser as chair

The Federal Reserve stood pat on its key interest rate, keeping it at a target rate range of 3.5% to 3.75%.

The meeting, anticipated to be the last with Jerome Powell as Fed Chair, was dramatic, however. Four members of the Federal Open Market Committee had dissenting votes, resulting in an 8-4 decision to keep rates steady.

Read more from CNBC’s Jeff Cox on the Fed’s dramatic split decision here.

—Darla Mercado

The major averages were modestly lower heading into the Fed’s interest rate decision.

As of 1:54 p.m. ET, the S&P 500 and the Nasdaq Composite were off 0.2%, while the Dow Industrials were down 300 points, or 0.6%.

The 10-year Treasury yield traded near its session high of 4.414%, while the 2-year note yield touched a session high of 3.918%. The U.S. dollar index also traded close to its session high of 98.913, while gold futures for June delivery were near the session low of $4,522.2.

—Gina Francolla, Darla Mercado

Oil prices have surged about 7% in trading Wednesday afternoon at 12:40 p.m. ET as traders react to an Axios report that President Donald Trump plans to maintain the U.S. naval blockade against Iran until Tehran agrees to a nuclear deal. The pop in prices has pushed the U.S. benchmark, West Texas Intermediate crude, above $106 a barrel, while the international benchmark, is above $119.

The higher energy prices that have followed the Middle East conflict have complicated the inflation picture for the Federal Reserve. Although oil price spikes are often ignored by policymakers as a temporary situation, the war between the Iran and U.S. could hamper the shipment of goods through the Strait of Hormuz for an extended period, especially if the two countries remain at a stalemate.

—Christina Cheddar Berk

For Americans now struggling to keep up with higher gas prices and overall affordability challenges, the central bank’s decision to keep interest rates unchanged does little to ease budgetary pressures.

Short-term rates, like credit cards, closely track the federal funds rate so those will likely stay elevated. Auto loan rates are tied to several factors, including the Fed’s benchmark. Longer-term rates, such as home loans, are more influenced by inflation and other economic factors. But as a result of geopolitical uncertainty, mortgages are also staying higher.

— Jessica Dickler

As all eyes are on what Powell might say at his potentially last meeting regarding his future as a Fed governor, bettors on Kalshi think he will stay on a little bit after his term as Fed chair ends.

Bettors place a 30% chance Powell steps down as a member of the Fed Board of Governors by June. However, bettors are more confident that he does that by August or the end of the year, with 66% and 81% odds, respectively.

If Powell doesn’t resign until August, he would stay on for two more meetings, the one in June and another in late July. Powell’s term as a Governor lasts until 2028. 

On prediction markets platform Polymarket, bettors see Powell stepping aside imminently. They give it an 87% chance he steps down between May 15 and May 22. 

Read more here.

— Davis Giangiulio

Kevin Warsh now has a clear path to replace Powell as the next Fed chair. The Senate Banking Committee advanced his nomination Wednesday, but the full Senate vote likely won’t happen for several days.

In the latest CNBC Fed Survey, respondents expressed some doubt about Warsh’s ability to maintain his independence, CNBC’s Steve Liesman reported earlier this week.

Just 50% of respondents believe Warsh will conduct monetary policy mostly or very independently, compared with 46% who say he will be only somewhat or not at all independent.

It’s a high level of concern, though confidence in his independence is 13-points higher than last month. That suggests Warsh might have convinced a few observers in his Senate confirmation last week.

The survey polled 26 economists, strategists and analysts on Thursday and Friday.

—Christina Cheddar Berk, Steve Liesman

Just hours before the Federal Reserve’s interest rate decision, the S&P 500 and Nasdaq Composite were seeing little movement.

The S&P 500 was trading around the flatline, while the Nasdaq Composite rose 0.1%, as of 10:58 a.m. ET. The Dow Jones Industrial Average, however, lost 247 points, or 0.5%.

— Sean Conlon

The Senate Banking Committee on Wednesday, in a party-line vote, advanced Kevin Warsh’s nomination as the next Federal Reserve chair.

By a 13-11 count, the panel sent President Donald Trump’s pick to the Senate floor as the successor to Jerome Powell, whose term ends in mid-May.

“Kevin Warsh’s leadership is absolutely essential now at the Federal Reserve than ever before,” Sen. Tim Scott, R-S.C., the committee chairman, said following the vote.

—Jeff Cox

The Supreme Court didn’t issue a ruling in the closely watched Trump v. Cook case on Wednesday. At issue is whether the president could remove Fed governor Lisa Cook from her position at the central bank.

Trump had attempted to fire Cook in August 2025, citing allegations of mortgage fraud for his decision. Cook has denied the allegations. The high court heard oral arguments in January on the case.

Many expect the outcome will be a statement on presidental powers and a measure of the central bank’s ability to remain independent.

—Christina Cheddar Berk

One lingering question is whether Jerome Powell will step down when his term as Fed chair ends. This has typically been the custom, but Powell could be motivated to remain as a governor to ensure that the central bank’s independence remains on solid ground.

Powell’s term as governor doesn’t expire until January 2028, and he could leave at any time before then.

U.S. attorney Jeanine Pirro recently abandoned a criminal investigation of Powell in order to clear the way for confirmation of Kevin Warsh, President Donald Trump’s nominee. Instead, Pirro said her office asked the Fed’s inspector general to investigate cost overruns in the multibillion-dollar renovation of the central bank’s headquarters in Washington.

Trump has been vocal like none of his predecessors when it comes to badgering the central bank, demanding lower interest rates while threatening to fire Powell and actively trying to remove Governor Lisa Cook.

If Powell leaves now, he will give Trump an opening to appoint another member to the Board of Governors. Counting Warsh, the president would have three appointees on the seven-member board, including Governors Christopher Waller and Michelle Bowman from his first term.

—Christina Cheddar Berk, Jeff Cox

Central bank policymakers are widely expected to keep their key interest rate on hold at their target range of 3.5% to 3.75% at the conclusion of their April meeting. Markets are pricing in a 100% chance the Federal Open Market Committee will stay on hold, according to the CME FedWatch tool.

Since it will likely be Fed Chair Powell final meeting, some suspect the news conference slated for 2:30 p.m. won’t be considered to be the strong signal about future policy as it usually is.

—Christina Cheddar Berk