Fed holds rates, consumer confidence 49.8
- The Federal Reserve left its benchmark rate unchanged at 3.50% to 3.75% on April 29, extending a wait-and-see stance into its third meeting of 2026. - Separately, the University of Michigan said April consumer sentiment fell to a record-low 49.8, while one-year inflation expectations jumped to 4.7% from 3.8%. - Higher oil and gasoline costs are complicating the Fed’s inflation fight and pushing rate-cut bets later in 2026. (federalreserve.gov)
The Federal Reserve left interest rates unchanged on Wednesday, keeping its benchmark range at 3.50% to 3.75% for a third straight meeting in 2026. (federalreserve.gov) That decision came after the Federal Open Market Committee’s April 28-29 meeting, with markets widely expecting no move before the statement landed. (federalreserve.gov) (cnbc.com) At the same time, the University of Michigan’s final April survey showed consumer sentiment at 49.8, down from 53.3 in March and the lowest reading in the series. (sca.isr.umich.edu) The same survey showed year-ahead inflation expectations rising to 4.7% from 3.8%, while long-run expectations climbed to 3.5%, the highest since October 2025. (sca.isr.umich.edu) Those numbers describe the bind facing the Fed. Borrowing costs are already high, but households are still bracing for faster price increases rather than relief. (federalreserve.gov) (sca.isr.umich.edu) Energy is a big part of that pressure. Reuters reported that April sentiment was hit by the inflation fallout from the Iran conflict, which disrupted shipping through the Strait of Hormuz and lifted fuel costs. (gazette.com) Joanne Hsu, director of the Surveys of Consumers, said the conflict appears to be shaping views mainly through gasoline and other prices. She also said diplomatic moves that do not ease supply constraints are unlikely to lift sentiment. (sca.isr.umich.edu) (gazette.com) Oil prices were still rising into the Fed decision. Reuters reported on April 28 that investors were weighing the Iran stalemate and the United Arab Emirates cutting ties with OPEC as West Texas Intermediate moved above $100 a barrel. (msn.com) CNBC reported before the meeting that markets had fully priced in a hold, with attention shifting to whether higher energy prices would keep the Fed from cutting soon. (cnbc.com) For borrowers, the immediate result is simple: credit-card rates, home-equity lines and other floating-rate debt stay tied to the same high-rate setting, while the next cut looks no closer than it did a week ago. (federalreserve.gov) (cnbc.com)
