Our takeaways from the April 2026 Fed meeting

by Daniel Kern

The Federal Reserve’s April 29, 2026, meeting delivered the expected outcome: Rates held steady at 3.50% to 3.75%. The rate decision was consistent with investor expectations, but there were two notable developments.

First, the Fed statement maintained its bias to cut rates, which prompted dissents from three voting members who wanted to remove the easing bias from the committee’s statement. A fourth voting member voted to lower rates. The last time that there were as many as four dissents was 1992.

Second, with Kevin Warsh appearing to be on track to be confirmed as the incoming Fed chair, Jay Powell held what is likely to be his final press conference as chair. Powell announced he will remain on the Federal Reserve Board as a governor after his term as chair ends, and he would “not leave the board until this investigation is well and truly over with transparency and finality.”

We are not surprised to see some differences of opinion among members of the Fed. Inflation remains above the Fed’s 2% target and may be moving in the wrong direction, given the continuing conflict in the Middle East. The labor market, however, appears to be softening amidst worries about a growth slowdown and potential job losses resulting from AI adoption.

We think it is likely that the Fed will remain on hold in the coming months, until there is more clarity about inflation and job market trends. We continue to think that 2% will represent the “floor rather than ceiling” for inflation in a deglobalizing world, where geopolitical tensions, climate events, and other supply shocks have become commonplace.

As always, the Nixon Peabody Trust Company team is here to help clients think through what a changing rate environment means for their portfolios and long-term plans. We welcome the conversation; feel free to reach out to our team anytime.

Daniel Kern
Chief Investment Officer
Office: +1 617.345.1044
dkern@nixonpeabody.com