Federal Reserve FOMC Statement and Powell's Key Remarks: Rates Unchanged, Powell to Remain as Governor After Term Ends

On April 30, the Federal Reserve FOMC statement:

1. The Federal Reserve maintains the benchmark interest rate range at 3.5%-3.75%, in line with market expectations, marking the third consecutive announcement this year to keep rates unchanged.
2. The voting results for this policy decision were 8 to 4: Milan voted against, advocating for a 25 basis point rate cut; Hamack, Kashkari, and Logan also voted against, opposing the inclusion of an easing bias in the statement.
3. The Federal Reserve described inflation as ‘still elevated,’ rather than ‘slightly elevated’ as previously stated, due to global energy prices.
4. The Federal Reserve aims to achieve full employment and a 2% inflation rate in the long term, with developments in the Middle East exacerbating the high uncertainty surrounding the economic outlook. The committee is attentive to the dual risks facing its dual mandate.
5. The Federal Reserve indicated that recent indicators show economic activity expanding at a solid pace. Job growth has remained low on average, while the unemployment rate has seen little change in recent months.
6. The Federal Reserve stated that when considering further adjustments to the federal funds rate, the committee will carefully assess the latest data, the evolving economic outlook, and the balance of risks. Federal Reserve Chair Powell’s remarks:
7. The current policy stance is appropriate and supports the achievement of the Federal Reserve’s policy goals; the current stance is well-suited for waiting.
8. The number of officials supporting a shift towards a neutral bias has increased; perhaps the next meeting will consider changing the current easing bias, and rate guidance may change at the next meeting.
9. If we need to raise rates, we will certainly signal that; currently, no one is calling for a rate hike.
10. Both aspects of the dual mandate face risks, with long-term inflation expectations aligned with the 2% target. The goal is to gradually bring inflation down to 2% while minimizing harm as much as possible.
11. After his term as Federal Reserve Chair ends on May 15, he will continue to serve as a Federal Reserve Governor.
12. Job growth is slow, the unemployment rate has not changed much, and consumer spending remains resilient; developments in the Middle East bring high uncertainty.
13. The independence of the Federal Reserve is facing threats, and the boundaries between the Federal Reserve and the Treasury need to be respected. If the Federal Reserve makes politically colored decisions, the market will lose confidence.