GOOG, MSFT, META: Options market braced for $1 trillion market cap swing after the bellTrump: It is a good time to cut ratesPowell says he will remain as a Federal Reserve GovernorPowell: Labor demand has softened clearlySo long JPOW and thanks for all the memesWhat are the changes in the FOMC statement from March to April 2026The full statement from the Federal Reserve April FOMC meetingFOMC decision: No change in rates as expectedNo one understands just how big the AI capex boom is. Some perspectiveTrump: I will not lift the naval blockade without a deal on the nuclear programBitcoin finds willing sellers near resistance targets, and the technical tilt shifts down.Bank of Canada’s Macklem: Under base case, changes to the policy rate likely to be minimalEIA weekly crude oil inventories -6234K vs -231K expectedHow and why all the Bank of Canada forecasts changed in the latest MPRBank of Canada statement from the April 2026 rate decisionBank of Canada rate decision: Hold at 2.25% as expectedUS March Trade advanced goods trade balance -$87.8B versus $-86.95 billion estimateUS March housing starts 1.502m vs 1.400m expectedUS durable goods orders for March +0.8% vs +0.5% expectedGermany April preliminary CPI +2.9% vs +3.0% y/y expected
The FOMC left rates unchanged, but the decision revealed a meaningful split beneath the surface.
The vote came in at 8–4, with Miran dissenting in favor of a rate cut, while Hammack, Kashkari, and Logan supported holding rates but opposed adding an easing bias to the statement. That group effectively pushed back against signaling near-term rate cuts—giving the decision a hawkish tilt, especially heading into the leadership transition from Jerome Powell to Kevin Warsh.
That said, the broader committee still leans dovish. Eight members supported maintaining the easing bias, meaning the path of least resistance still points toward eventual rate cuts—even if the timing remains uncertain.
As for Powell, this marked his final meeting as Fed Chair. He noted that he intends to remain at the Fed in a lower-profile role, particularly as legal challenges involving the institution continue to play out.
Key Takeaways from his press conference:
Inflation still a problem: Core PCE seen at 3.2%, headline PCE 3.5%; near-term inflation expectations are rising, partly driven by higher energy prices
Labor market cooling but stable: Demand has softened, job growth is slowing, but the labor market is not deteriorating sharply
Consumer remains resilient: Spending continues to hold up despite higher prices
Policy stance = patient:
No urgency to remove the easing bias
No support for rate hikes right now
Debate was “vigorous,” but the majority favored no change in guidance
Next 30–60 days of data will be key
Internal divide at the Fed:
Some favor moving toward neutral to reflect markets
Others prefer waiting in case policy needs to reverse
Bottom line on policy:
Fed is not in a hurry to shift direction
Inflation is “misbehaving,” but labor is stabilizing → keeps Fed cautious and data-dependent
Tone / Bias:
Slightly hawkish hold → inflation concerns + no rush to ease
But not outright hawkish → no appetite for hikes
Market implication:
Supports higher yields / stronger USD bias near term
Keeps volatility tied to incoming inflation and labor data
As such, yields did indeed move higher. Looking at the yield curve:
2 year yield 3.946%, rose 10.3 basis points10 year yield 4.429%, rose 7.6 basis points30 year yield 4.999%, rose 5.5 basis points
US stocks closed little changed. Both the S&P and the Nasdaq moved 0.04% on the day with the S&P down -0.04% and the Nasdaq up 0.04%. The Dow and the Russell 2000 the story was less encouraging with each falling by around -0.60^.
The USD moved higher with the USDJPY breaking to the upside and reaching a new high for the year going into the close above 160.45. The EURUSD is trading just under its 200 day MA at 1.1674 (at 1.1671).
The Bank of Canada also met today, and kept rates unchanged (concerned about employment getting wearker and inflation moving higher but then coming back off later in the year – if oil price came down. The USDCAD moved higher after the decision and away from the converged 100/200 hour MAs at 1.3666. However, the price bounced off of that level, keeping the buyers in play. If the price is to move higher from here, it needs to stay above the MAs and also extend above the high from last week at 1.3715 and the 100 day MA at 1.37295.
Oil prices was also a tailwind for yields moving higher, and the USD moving higher. It surged by 8.57% on the day as the Trump administration signaled the strategy to starve Iran by the blockaid of the Strait of Hormuz. That plan could keep the flow of ships limited for “months”.
This article was written by Greg Michalowski at investinglive.com.