Fed Holds Rates Steady as Warsh Nomination Advances

The Federal Reserve held its key interest rate steady at 3.5 to 3.75 percent on Wednesday, marking the third consecutive meeting with no change following three quarter-point cuts in late 2025. The decision came as Chair Jerome Powell presided over what is likely his final policy meeting before his term ends on May 15, while the Senate Banking Committee advanced President Donald Trump's nominee, Kevin Warsh, to succeed him in a 13-11 party-line vote.

The Federal Open Market Committee's vote revealed internal divisions, with eight members in favor of the pause and four opposed to a policy statement adjustment that could signal future rate cuts. Officials noted elevated inflation, partly due to rising global energy prices amid the war in Iran, which has pushed the rate to a two-year high of 3.3 percent. Energy prices rose 10.9 percent in March after U.S. strikes began, according to the Bureau of Labor Statistics.

Powell's term as a member of the Fed's Board of Governors extends until January 2028, and he has indicated he plans to remain in that role after stepping down as chair, a move that would be unusual since 1948. Officials said such a decision could help safeguard the central...