Deutsche Bank: April FOMC Recap: Powell's Hike Drop - FJElite

The Fed left rates unchanged at the April FOMC meeting and, in a close vote, kept a mild easing bias in the statement. The main takeaway from Powell’s final press conference as chair was not a policy shift, but a signal that the Committee is actively debating whether to move toward a more balanced description of the outlook. Powell said that discussion was vigorous and suggested the guidance language could become more balanced as soon as June. He also said he plans to remain on the Board as a Governor for now, citing legal issues around the Fed and concerns about preserving Fed independence.

The broader message is that the Fed is moving closer to a more neutral framing, but not yet changing course. That supports the view that rates are likely to stay unchanged this year, with policy effectively on hold near neutral. A rate hike is still not impossible, but lower rates are still seen as more likely than higher ones over the course of the year.