Economic Data and Growth

As anticipated, the Federal Open Market Committee maintained its interest rate target range at 3.50%–3.75% at its April meeting. On the other hand, one FOMC member—Stephen Miran—dissented from the action, preferring to lower the target range by 25 basis points. In a change to its previous statement, the FOMC noted that inflation remains elevated, in part reflecting the recent increase in global energy prices. Furthermore, three FOMC members—Beth Hammack, Neel Kashkari and Lorie Logan—supported keeping the target range steady but did not support the inclusion of an easing bias in the statement regarding considering “additional adjustments to the target range.” Collectively, there were four dissents to the policy statement out of 12 members, the most since 1992.

In the press conference following the meeting, Federal Reserve Chairman Jerome Powell said that economic activity continues to expand at a solid pace, with job gains staying low while inflation has moved up and remains elevated. Chairman Powell noted that higher oil prices due to events in the Middle East will push up the overall inflation rate in the near term, but the scope and duration of potential effects on the economy remain unclear, as does the future of the conflict itself. He reaffirmed that the FOMC is well positioned to determine the extent and timing of additional adjustments to its policy stance. This press conference was Powell’s last as chairman, but he noted that he planned to remain on the central bank’s board for a period of time to be determined and at least until the resolution of the administration’s legal challenges against the Federal Reserve, which he believes are battering the institution.

The FOMC’s summary of economic projections, which maps out the Federal Reserve’s expectations for where interest rates may be headed in the future, generally is released in conjunction with every other FOMC meeting. Since the March meeting included a release of economic projections, there was not a release in conjunction with the April FOMC meeting. The March summary signaled a mixed stance regarding where monetary policy should go in 2026. Twelve Federal Reserve officials projected additional rate cuts across 2026, while seven anticipated no additional rate cuts this year. Furthermore, a majority of the officials who predicted a rate cut this year anticipated just one 25-basis-point cut across 2026.