U.S. Federal Reserve Chair Jerome Powell speaks during a press conference following a two-day meeting of the Federal Open Market Committee (FOMC) on interest rate policy, in Washington, D.C., U.S., Jan. 28, 2026.
Jonathan Ernst | Reuters
The Federal Reserve wrapped up a two-day policy meeting Wednesday, delivering pretty much what the market expected and no major surprises from Chair Jerome Powell’s news conference. Here are five things worth remembering:
- The decision: To no one’s surprise, the rate-setting Federal Open Market Committee held its benchmark funds rate in a range between 3.5%-3.75%. The move broke a string of three straight cuts and could be a harbinger of a central bank not of a mind to ease again anytime soon.
- The dissents: As has been the custom for the past six months or so, multiple committee members broke ranks. This time, Governors Stephen Miran and Christopher Waller wanted another quarter percentage point cut. For Miran, though, it represented a bit of a turn as he deviated from three prior dissents in favor of half-point reductions.
- Powell’s post-meeting news conference was, in a word, a snoozer. On five separate occasions, the chair delivered variations on “I have nothing for you on that” to questions from reporters looking to bait him into commenting on the multiple political kerfuffles surrounding the Fed. Asked for the advice he would give his successor, Powell responded, “Stay out of elected politics.”
- From an economic standpoint, the FOMC statement and Powell’s commentary reflected expectations for solid growth, a near-term tariff-fueled boost for inflation that ultimately will recede, and a labor market in stasis as the labor force participation rate plus less immigration keep hiring in check while layoffs are also muted.
- And the markets yawned. With little to go on, the major stock averages closed little changed. Traders are still pricing in about a 60% chance of two additional, quarter percentage point rate cuts this year.
What they’re saying
“The Fed delivered a rate cut, but it arrived in a somewhat hawkish package. The Fed hasn’t shut the door on further cuts, but Chair Powell has raised the bar for further action. We expect the economy to grow at a solid pace next year, but it must be accompanied by job gains. The next round of jobs data may point to the exact opposite.” — Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management.
“It’s détente at the Fed for now. But a shakeup is coming with the new Fed Chair in May.” — Heather Long, chief economist at Navy Federal Credit Union.
“Perspectively speaking, we saw this meeting as an affirmation from the Fed of what investors were already thinking. Labor conditions are not worsening, growth has accelerated and inflation has steadied for now. To put it in other words, policy rates are much closer to neutral against the current backdrop and it’s time for a long pause.” — Charlie Ripley, senior investment strategist for Allianz Investment Management.
