What Jay Powell's Final Meeting As Fed Chair Means For Kevin Warsh

TL;DR

Powell announced he'll stay on as Governor after his Chair term ends May 15th, while the Fed held rates amid four dissents signaling internal division for incoming Chair Kevin Warsh.

Key Points

• 1.Powell will remain as Fed Governor after his Chair term expires May 15th. This mirrors a rare historical precedent set in 1948 when Chair Marriner Eccles stayed on, also during a period of threatened Fed independence.
• 2.The Fed held rates but faced four dissents pulling in opposite directions. Governor Stephen Miron wanted a quarter-point cut, while regional presidents Beth Hammack, Neel Kashkari, and Lorie Logan resisted statement language implying the next move would be a cut.
• 3.The internal dissent creates a fractious environment for Kevin Warsh's incoming chairmanship. The three regional presidents' pushback signals they won't accept being told to cut rates, complicating Warsh's ability to build consensus on a Fed navigating tariff-driven supply shocks.