The Fed held rates. Everyone expected that. Then Powell dropped two surprises that nobody expected.
The Federal Open Market Committee voted to keep rates at 3.50% to 3.75% on Wednesday, the fourth consecutive hold. But the vote was 8-4, the most divided Fed decision since October 1992. Three hawks wanted to remove the easing bias from the statement entirely. One dove wanted a 25 basis point cut. The consensus is cracking.
Then came the real story. Powell announced he will stay on as a Fed Governor after his chairmanship ends on May 15, citing legal pressure from the Trump administration. “I had long planned to be retiring,” Powell said. “The things that have happened really in the last three months have left me no choice but to stay.”
Bitcoin dipped 1% to $76,200 during the press conference, then recovered to $77,100 as traders digested what Powell’s decision actually means for the rate path ahead.
Why Is Powell Staying and What Does It Mean?
Powell’s governor term does not expire until January 2028. By staying, he does something Trump does not want: he denies the president a majority on the Board of Governors.
The seven-member board currently includes Trump appointees Christopher Waller, Michelle Bowman, and Stephen Miran. Adding Warsh as chair would give Trump four out of seven. But if Powell stays in his governor seat, Warsh replaces Powell as chair but not as a board member. Trump gets three appointees plus Warsh. Powell remains as a counterweight.
“This means that the addition of Kevin Warsh to the FOMC will not swing the balance between doves and hawks,” said Josh Jamner, senior investment strategy analyst at ClearBridge Investments.
For crypto, this matters. Warsh pledged during his confirmation to cut rates quickly. But three Fed officials just dissented because they thought the statement was too dovish. If Warsh walks in and tries to push for cuts, he faces a committee that already signalled it is not interested. Powell sitting on the board makes that resistance even harder to overcome.
Powell was clear he does not plan to be a “shadow chair.” He said he is staying to see the renovations investigation through “with transparency and finality.” But the practical effect is the same regardless of his intentions: the incoming chair has less room to move than anyone expected.
What Did the Four Dissents Signal?
This was the biggest surprise from the rate decision itself. Four FOMC members dissented, the most since 1992. Three of them, Cleveland’s Beth Hammack, Minneapolis’s Neel Kashkari, and Dallas’s Lorie Logan, wanted to remove the easing bias from the statement. They are not saying “raise rates.” They are saying “stop telling the market we might cut.”
The fourth dissent came from Stephen Miran, who wanted a 25 basis point cut. That is the sixth consecutive meeting where Miran has dissented in favour of lower rates.
The three hawkish dissents send a clear message to Warsh: do not assume you can push cuts through easily. “Warsh is in the unfortunate position, through no fault of his own, to probably be the least influential Fed chair in a long time,” said Christopher Hodge, chief US economist at Natixis CIB. “He’s going to have a really hard time convincing the other members to cut rates quickly.”
Oil sitting at $105 per barrel makes that even harder. Higher energy costs feed directly into inflation. The three dissenters explicitly cited the Iran war’s inflation risk as their reason for opposing the easing bias. As long as the Strait of Hormuz stays closed and oil stays above $100, the hawks have the stronger argument.
How Did Bitcoin React?
Muted. BTC dropped about 1% during Powell’s press conference, touching $76,200, then bounced back to $77,100 within the hour. The initial dip was a sell-the-news reaction consistent with the pattern we covered earlier this week: Bitcoin has fallen after 8 of the last 9 FOMC meetings regardless of what the Fed actually said.
The recovery came as traders realised the statement was not as hawkish as it could have been. The easing bias stayed in, despite the three dissents. That means the Fed is officially still open to cuts, even if the committee is deeply divided about whether they should happen.
Crypto markets were more focused on the Big Tech earnings landing Wednesday evening. Microsoft, Amazon, Meta, and Google all reported after the close. Strong results from any of them could lift risk appetite and push Bitcoin back toward $78,000. Weak results could send it back toward $75,000.
What Happens When Warsh Takes Over on May 15?
Warsh was advanced from the Senate Banking Committee on a party-line vote Wednesday morning. A full Senate confirmation vote could come within days. He would then officially become Fed chair on or around May 15.
His first meeting as chair would be in June. And the dynamics he walks into are unusual. He has pledged to cut rates. He has said he wants to end forward guidance. He has proposed reforming the regional reserve banks. He is openly sceptical of the communication practices Powell spent years building.
But three committee members just publicly opposed any hint of easing. Powell is staying on the board as a voting governor. And oil is at $105 with no peace deal in sight. Warsh may want to cut. The committee may not let him.
For Bitcoin, the Warsh era is still potentially bullish in the medium term. A pro-crypto Fed chair who wants lower rates is better than any alternative. But the path from “wants to cut” to “actually cuts” just got longer and more complicated.
Frequently Asked Questions
Did the Fed cut rates in April 2026?
No. The FOMC held rates at 3.50% to 3.75% for the fourth consecutive meeting. The vote was 8-4, the most dissents since October 1992. Three members wanted to remove the easing bias and one wanted a 25 basis point cut.
Why is Jerome Powell staying on the Fed board?
Powell said legal actions taken against him by the Trump administration over the past three months left him “no choice” but to stay on as a Fed Governor. His governor term runs until January 2028. By staying, he denies Trump a majority on the seven-member Board of Governors.
What does the Fed decision mean for Bitcoin?
Bitcoin dipped 1% to $76,200 during Powell’s press conference then recovered to $77,100. The easing bias remained in the statement, keeping rate cuts technically on the table. But the four dissents and Powell staying on the board suggest rate cuts will be harder to deliver than markets previously expected.
