A Break With Tradition: Powell Won’t Fully Step Down
It was quite a surprise yesterday: Federal Reserve Chair Jerome Powell said he will remain at the Fed as a governor after his term as chair ends next month, arguing he has little choice amid a wave of legal attacks he says are “battering” the central bank. This is an unusual thing, since normally ex Fed Chairs resign completely.
“These legal actions by the administration are unprecedented in our 113-year history,” Powell said. “I worry they are battering the institution and putting at risk what matters most to the public: our ability to conduct monetary policy without political influence.”
Powell said he will stay “for a period of time to be determined.” His term as chair ends May 15, and he offered no firm timeline beyond saying he will leave “when I think it is appropriate.”
The move could allow Powell to keep voting on U.S. monetary policy until 2028, and it quickly became a new flash point with President Trump and his team. Trump immediately fired back on Truth Social, claiming Powell was staying on “because he can’t get a job anywhere else.”
I am not sure yet if Powell staying is good or bad news. It definetely shows though that the monetary policy gets more and more into the focus of politics who wants to gain influence and align the Fed with their ambitions. What do you think?
