Fed Changes Leadership, but Powell Stays On Board

Following the April meeting of the Federal Open Market Committee (FOMC), the Federal Reserve opted to maintain its current stance, leaving interest rates unchanged. The target for the federal funds rate remains at a top level of 3.75%, where it has stood since December.

This meeting may represent the final policy decision led by Jerome Powell in his role as Chair of the Fed’s Board of Governors, bringing his eight-year tenure in that position to a close. President Trump’s nominee, former Fed Governor Kevin Warsh, is widely expected to secure Senate confirmation and take over in time for the next FOMC gathering.

However, Powell is not expected to fully step away from the Fed. Instead, he plans to continue serving as a member of the Board of Governors after relinquishing the Chair position. Powell’s term as a Governor could run through 2028, and his continued position on the Board may shape how quickly any new policy direction from Warsh is introduced.

Powell has said he will remain as a Governor as long as the Justice Department’s probe into the cost of the renovations to the Fed’s headquarters remains active.

Looking ahead, both the economic outlook and the path of monetary policy remain clouded by global instability, largely stemming from the war in Iran. Under these conditions, any shift toward policy easing by the Fed appears unlikely until late 2026, at the earliest.

NAHB Chief Economist Dr. Robert Dietz offers additional insights on Eye On Housing.