Federal Reserve Chairman Jerome Powell announced that he will remain on the Fed’s Board of Governors beyond the end of his term as chairman next month, breaking with tradition at the central bank and preventing President Donald Trump from quickly nominating his replacement.
Powell, who was holding his last press conference as Fed chairman, previously said he would remain on the Fed board until the Justice Department investigation into him ended. On Wednesday, he confirmed that he plans to remain on the board. While his term as chairman ends on May 15, his term as a member of the board runs until 2028.
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“My decisions on these matters will continue to be guided entirely by what I believe is in the best interest of the institution and the people we serve,” Powell said. “After my term as chair ends on May 15, I will continue to serve as a governor for a period of time to be determined.”
He added that he intends to keep a “low profile” as a Fed governor.
Powell’s plan to stay on the board will deprive Trump of having a majority of seats on the Fed’s Board of Governors. While Powell is technically a Trump appointee, Trump has criticized his monetary policy philosophy
The announcement comes the same day that the Senate Banking, Housing, and Urban Affairs Committee advanced the nomination of Kevin Warsh, President Donald Trump’s pick to replace Powell as chairman.
Traditionally, Fed chairmen retire from the board after their term as chairman is up, allowing the president to fill the vacancy. Powell’s situation is unusual, though, given the investigation and other legal matters tied to the Fed, including Trump’s effort to oust Fed governor Lisa Cook.
Powell said his decision to stay at the Fed was driven by his worries about Trump’s legal actions against the central bank.
“My concern is really about the series of legal attacks on the Fed,” he said.
The move sets up an awkward position in which Powell, the former chairman, will be voting on interest rate decisions presumably overseen by Warsh, whom Trump has nominated to replace him. As long as Powell stays on, the majority of board members will not be Trump appointees.
“There’s only ever one chair of the Federal Reserve Board,” Powell said at the press conference. “When Kevin Warsh is confirmed and sworn in, he will be that chair. Once sworn in as board chair, his new colleagues will elect him to chair the FOMC as well.”
The Washington Examiner reached out to the White House for comment on the news.
Powell said Wednesday that he welcomed the announcement last week that the DOJ had dropped its investigation into him. U.S. Attorney Jeanine Pirro said that the investigation had ended, and instead, the inspector general for the Fed has been asked to scrutinize the building cost overruns.
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“I expect a comprehensive report in short order and am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas,” she said. “Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry.
“Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so.”
