Fed Keeps Rate at 3.5%-3.75% Amid Inflation, Mideast Risk

The Federal Open Market Committee voted 8–4 on April 29, 2026, to keep the federal funds rate in a 3.5%–3.75% target range. Chair Jerome Powell and the majority pointed to persistent inflation pressures and a still-firm labor market as reasons for preserving the current policy stance.

In its post-meeting statement the Fed wrote that “inflation is elevated, in part reflecting the recent increase in global energy prices,” and noted that “job gains have remained low, on average, and the unemployment rate has been little changed in recent months.”

Officials highlighted international risks, with the committee stating “developments in the Middle East are contributing to a high level of uncertainty about the economic outlook.” The statement noted the panel “will carefully assess incoming data, the evolving outlook, and the balance of risks” and that it “would be prepared to adjust the stance of monetary policy as appropriate if risks emerge” that could interfere with meeting its goals.

Eight members voted to hold the target range: Jerome Powell; Vice Chair John C. Williams; Michael S. Barr; Michelle W. Bowman; Lisa D. Cook; Philip N. Jefferson; Anna Paulson; and Christopher J. Waller. Stephen I. Miran cast the lone vote in favor of an immediate quarter-point cut.

Neel Kashkari, Lorie K. Logan and Michelle W. Bowman registered objections to parts of the statement they argued could be read as signaling an easing bias, reflecting disagreement within the committee about the near-term path for rates.

The committee left open the possibility of future adjustments but provided no timeline. Markets and borrowers will look to the Fed’s next scheduled meeting for further signals as officials monitor incoming inflation and employment data. Until then, short-term U.S. borrowing costs remain at the current 3.5%–3.75% range.