On Wednesday, April 29, 2026, Jerome Powell hosted what is widely considered to be his last meeting as Chairman of the Federal Reserve. As he stepped away from the podium at his final post-meeting press conference, he noted playfully to the media, “I won’t see you next time.” Powell’s term as chairman expires in mid-May. He served eight years as chair, across two terms marked by significant challenges, including a global pandemic, and leaves the leadership role still fighting stubbornly high inflation. As the Powell era comes to an end, Cox Automotive Chief Economist Jeremy Robb weighs in on the final meeting.

Four Dissents and What They Signal

The vote in Chair Powell’s final Federal Open Market Committee (FOMC) meeting produced four dissents, an unusually high number that warrants attention, and a level of disagreement not seen at the Fed since October 6, 1992. One member, Stephen Miran, voted in favor of a rate cut, as he has consistently since joining the Fed board in September 2025. Three others, Beth Hammack, Neel Kashkari, and Lorie Logan, agreed with holding rates steady but objected to the inclusion of an easing bias in the statement language.

In other words, a significant portion of the committee does not want markets to interpret the current decision to leave the federal funds rate unchanged as a step toward future cuts. That divide within the FOMC is itself a meaningful signal about where policymakers stand on the road ahead.

As we’ve noted earlier, in the current environment and even with new leadership, a rate cut by the Fed is now highly unlikely in 2026. More importantly, for long-term loans such as autos, the federal funds rate matters less than the level of longer-term Treasury yields. Auto loan rates are priced off bond yields of similar duration, often the 5-year U.S. Treasury, not the Fed’s overnight rate.

Still, the Fed’s decision and perspective are important. This month, the decision to hold steady sends a clear signal to the market. With energy prices climbing, inflation likely to increase, and the labor market sending mixed signals, there is little reason to expect near-term relief in auto loan rates. Credit availability has been improving, but rates are not coming down, and current guidance suggests that will remain the case for some time.

Powell’s Final Chapter

On April 24, the Department of Justice dropped its investigation into the Fed’s use of funds for a building renovation, a probe that had been a procedural obstacle to the Senate confirmation of Kevin Warsh, President Trump’s nominee to replace Powell. With that hurdle cleared, Warsh’s path to confirmation has opened considerably, and Powell’s tenure appears to be drawing to a close.

Powell has indicated he intends to remain a member of the Fed’s Board of Governors through the end of his term in 2028, even as President Trump has subjected him to sustained public criticism. Powell has been explicit that his decision to stay is rooted in defending the institutional independence of the Federal Reserve, while he has been equally clear that he has no intention of operating as a shadow Fed chair or second-guessing his successor’s decisions. Whether he remains through 2028 or departs earlier remains an open question, but his presence on the Board would represent an unusual dynamic, one in which a former chair serves alongside the new leadership he handed the reins to under significant political pressure.

A New Era of Debate at the Fed?

Kevin Warsh has been transparent about his vision for the institution. At his Senate confirmation hearing last week, he stated openly that he favors “messier meetings” and welcomes discussion and dissent among FOMC members, believing a diversity of opinions leads to better decisions. If confirmed, this latest meeting’s level of internal disagreement may not be an anomaly. It could become the new normal.

That prospect introduces an additional layer of uncertainty into an environment the Fed itself characterized as having “a high level of uncertainty.” Markets generally prefer clarity and consistency from the central bank. A committee more openly divided, even in the service of richer deliberation, could add volatility to rate expectations at an already delicate moment.

Energy Markets: The Wildcard That Isn’t Going Away

This economic uncertainty is compounded by what is happening in global energy markets. The Middle East conflict, which the Fed explicitly cited as a source of elevated uncertainty, shows no clear signs of resolution, as oil prices continue to climb. Adding to the complexity, the UAE announced this week that it is withdrawing from OPEC, a development that introduces fresh instability into global energy supply dynamics at precisely the wrong time.

In a more benign environment, the Fed might choose to look through an oil price shock, treating it as a temporary, supply-driven disruption. But the current situation makes that posture difficult to sustain. Energy prices are not a brief spike. They reflect an ongoing geopolitical conflict with no clear resolution timeline. When energy costs remain elevated long enough, they stop being a one-time adjustment and begin seeping into broader inflation expectations, as energy prices impact transportation, manufacturing, food production, and services.

The Fed is acutely aware that inflation expectations, once unanchored, are far harder to bring back down than they are to prevent from rising in the first place. The practical consequence is that the Fed’s ability to cut rates in the near term is further constrained. Even members inclined toward easing cannot easily justify rate reductions while energy-driven inflation remains an open question. The extended outlook for inflation, and by extension financing costs across the economy, grows murkier the longer this persists.

The Stock Market’s Blind Spot

Against this backdrop, equity markets have remained notably resilient, with the stock market appearing to price in a relatively optimistic scenario in which the Middle East situation resolves and energy prices stabilize. That may yet prove correct. But it also means markets may not be positioned for a deterioration in the conflict or a sustained energy price shock. If that scenario materializes, the adjustment could be sharp.

The stakes for the automotive market extend well beyond what happens on Wall Street. Consumer spending in the United States is meaningfully supported by the wealth effect, the confidence and spending capacity that a strong equity market provides to households. A significant market correction, should one occur, would not stay contained to financial portfolios. It would flow directly into consumer sentiment and discretionary spending, and for the vehicle market specifically, the consequences could be material.

Consumers who feel less wealthy tend to delay big-ticket purchases, defer trade-ins, and stretch existing vehicles longer, a combination of factors that would pressure new-vehicle sales and, as a downstream consequence, soften used-vehicle values. Wholesale depreciation that might otherwise follow a seasonal pattern could accelerate if retail demand pulls back faster than inventory adjusts. The used-vehicle market, which has benefited from the Spring Bounce and tax refund tailwinds in recent weeks, would be among the first places that demand disruption would show up.

None of this is the base case. But equity markets pricing in resolution while geopolitical and energy risks remain unresolved is a mismatch worth watching closely. Uncertainty continues to define the economic landscape, and that has downstream effects that loom large for consumers and dealers. The era of the Fed under Jerome Powell will soon be over, but the market may be getting a glimpse into a policy path that welcomes debate and dissent much more than past regimes.