Fed meeting updates: Will FOMC hold interest rates? What to expect from Jerome Powell’s last meeting

The latest jobs report from the Bureau of Labor Statistics showed stronger job creation in March after the previous report showed that weather and a healthcare strike affected employment in February.

The US added 178,000 jobs in March, blowing past expectations and offsetting the 133,000 lost the month before. Healthcare and the leisure and hospitality sector had the largest gains among major industries. However, the Iran war could still have knock-on effects for the US economy down the line. Diane Swonk, KPMG’s chief economist, said this doesn’t reflect the full effects of “the shock to energy prices and supply chains” because of the survey’s timing.

“It tells us that what we already knew was that we entered the year with the tailwind, part of it being the catch-up to the government shutdown, part of it being fiscal stimulus, but now we’re facing the headwinds of much higher energy prices,” Swonk said, adding, “I would expect to see much softer job creation going forward as uncertainty has spiked again.”

Business Insider took a look at Powell’s economic record during his news-packed eight years running the Fed, which shows cautious monetary decisions, and mixed inflation and job market outcomes.

“Jerome Powell’s tenure will likely be viewed favorably, offering lessons that economists can use to better inform future policy,” said Stephen Kates, a financial analyst at Bankrate. “Powell has been a consensus builder within the Federal Reserve and has conducted himself with composure during periods of escalating public and legal pressure from the White House to lower rates.”

Mark Zandi, chief economist at Moody’s Analytics, said, “Chair Powell has done a bang-up job as chair of the Fed,” navigating “massive shocks to the economy,” including wars, tariffs, and changing immigration policy.

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With both the Fed decision and a slew of Big Tech earnings, it’s set to be a busy day for markets.

All three major US indexes are set to open a little higher, with futures pointing to both the Dow and S&P 500 gaining just 0.1% at the open, and the Nasdaq set to tick 0.4% higher.

Stocks in Europe are down on the day, though falls are largely limited. The biggest drop is in the UK, where the FTSE 100 is down roughly 0.8%.

In commodity markets, oil prices rose on Wednesday, seemingly spurred by President Donald Trump’s latest threat to Iran. Early in the morning, Trump shared a Truth Social post including what appeared to be an AI-generated image of himself wearing sunglasses and holding a gun with the caption “No more Mr. Nice Guy.”

Just before 7 a.m. ET, Brent crude, the international benchmark, was 2.8% higher at $107.30 per barrel, while WTI crude was up 3.3% to $103.25.

As of Wednesday morning, CME FedWatch — which estimates probabilities of the Fed’s choices based on market moves — is predicting a 100% chance of a rate hold. The FOMC aims to balance both sides of its dual mandate, fostering stable prices and maximum employment. Lowering rates could help thaw a frozen job market, but it carries the risk of rising inflation. It’s likely the Fed will take a moderately restrictive stance, keeping rates steady alongside oil shocks from the Iran war.

After holding the post since 2018, Wednesday is set to be Powell’s last meeting as central bank chair. His term is officially up on May 15, and Trump nominee Warsh is likely to be greenlit by the Senate as successor. The Senate Banking Committee is scheduled to meet this morning to vote on whether or not to advance his confirmation to the full Senate.

It’s rare for a chair to remain on the Federal Open Market Committee after their tenure, but Powell has hinted that he may hold on to his governor seat: “I will make that decision based on what I think is best for the institution and for the people we serve,” he said last month. Powell is eligible to vote on the committee until 2028, if he were to stay.