Happy Tuesday, GoldBuzzers!

Outgoing Fed Chair Jerome Powell wrapped his final meeting yesterday with an 8-4 vote, the most divided Fed result in over 30 years. Gold and silver had been selling off all week on Iran and oil, so the meeting itself was actually a bit of an anticlimax for the metals.

In today's Real Talk, I’ll break down what the dissent was really about, what it sets up for the incoming Chair, Kevin Warsh, and what it means for gold and silver.

Ok. Let’s get into it. ⬇️

Gold slid to around $4,544 on Wednesday, its lowest level in over a month, as the Fed held rates steady at 3.5%-3.75% in what turned out to be a remarkably divided meeting. The vote split 8-4, the most dissent the FOMC has seen since October 1992, with three members pushing to drop the easing bias from the statement entirely and Governor Miran voting for a cut. The message from the majority? Inflation is still too hot, partly thanks to surging energy prices from the ongoing Strait of Hormuz closure, and rate cuts are not coming anytime soon.

Markets are now pricing in zero changes through the rest of 2026. Powell, in what may have been his final meeting as chair, said he plans to stay on as a governor even after Kevin Warsh takes over (the Senate Banking Committee advanced Warsh's nomination the same day).

Silver fell again, to $71.45, following Tuesday's brutal 3%-plus selloff, with the Hormuz shutdown - which has choked off roughly 20% of global oil flows in what the IEA called the largest supply shock on record - keeping inflation fears front and center. Trump's rejection of Iran's latest peace proposal means there is no end in sight to the energy disruption.

The ECB and Bank of England announce their rate decisions today, and the tone is expected to lean hawkish. For metals, the math is simple right now: higher energy costs feed inflation, inflation keeps rates elevated, and elevated rates make non-yielding assets like gold and silver a tougher sell. The bull case may have to wait a while longer, as the short-term headwinds are real.

Yesterday's Fed meeting delivered the hold everyone expected. Rates stay at 3.50% to 3.75% for the third meeting running. Markets had priced this at 99.5% before outgoing Fed Chair Jerome Powell walked into the room, so the headline number was never the story.

The vote was.

Four members dissented. That's the most disagreement on the committee since October 1992. Three of them - regional Fed presidents Beth Hammack of Cleveland, Neel Kashkari of Minneapolis, and Lorie Logan of Dallas - voted no because they want the language about future cuts pulled out of the statement. They don't want to signal easing. The fourth, Fed Governor Stephen Miran, went the other way and pushed for a quarter point cut right now.

A divided committee, in Powell's final meeting as Chair.

The metals had already done most of the moving before Powell stepped to the podium. Gold dropped close to 2% on Tuesday to a one-month low below $4,600, pulled down by surging oil, the Strait of Hormuz closure, and the market's growing assumption that the Fed would refuse to signal cuts. By the time the statement hit Wednesday, spot gold was already trading near $4,600. The post-decision move was modest by comparison, another 1% lower to around $4,569. Silver had taken a sharper hit through the week, dragged by its industrial demand exposure as much as by anything Powell said.

Two things are worth holding in mind before you read that as a verdict.

First, the Fed itself is now naming the two pressures keeping inflation sticky: energy and geopolitics. Powell spent his press conference walking through what he called four supply shocks - the pandemic, the Ukraine invasion, tariffs, and now Iran and the oil spike. The Strait of Hormuz remains closed. Roughly 20% of global oil flow runs through that channel. April's preliminary Michigan inflation expectations jumped to 4.8%, the biggest one-month spike in a year. That's the backdrop the Fed is admitting it can't control with rates alone.

Second, the chair handoff is now in motion. Kevin Warsh, Trump's nominee for the role, cleared the Senate Banking Committee on a party-line vote the same day. He could be presiding over the June meeting. Powell is staying on as a Governor for what he described as an undetermined period, partly for continuity, partly because he wants the various Fed-related investigations resolved before he steps off the board entirely. So the committee Warsh inherits already has four members who can't agree on the next move.

That matters for how you read what comes next.

If Warsh wants to ease aggressively to please the administration, he walks into a room where three regional presidents already voted to remove any mention of future cuts. If inflation reaccelerates from energy and the Fed has to hold or even hike, the case for owning gold and silver as portfolio insurance gets more important, not less. Either path keeps the metals case intact.

I'm not going to tell you yesterday was a green light. It wasn't. Higher-for-longer keeps real yields in territory that pressures non-yielding assets, and silver in particular will keep moving harder than gold in both directions while the Hormuz situation drags on. If you're sitting on physical and watching the screen turn red this week, that's the trade-off you signed up for.

What I will say is that the bigger picture - central banks still buying, BRICS still working on dollar alternatives, U.S. debt service still climbing, and a Fed that just openly admitted it's wrestling with shocks it can't out-tighten - hasn't shifted because of one meeting. If anything, an 8-4 vote in Powell's final meeting tells you the institution itself is divided about how to handle what's coming.

Pullbacks like this week's have historically been entry points for long-term holders, not exits.

We'll soon see whether this one follows the pattern.

That’s all for this Thursday, folks. See you on Sunday.

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Rick Adams
Founder, GoldBuzz
rick@goldbuzz.com