Federal Reserve Chair Jerome Powell on Wednesday said he will stay on the Board of Governors for an indefinite period while a probe into the renovation of the central bank’s headquarters continues.
“I’ve said that I will not leave the board until this investigation is well and truly over with transparency and finality, and I stand by that. I’m encouraged by recent developments, and I’m watching the remaining steps in this process carefully,” Powell said near the beginning of his post-meeting news conference.
“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 after my term as chair ends on May 15, and will continue to serve as a governor for a period of time to be determined,” he added.
By staying on, Powell for the moment is denying President Donald Trump a majority on the Board of Governors. Trump’s other appointees on the seven-member board include Christopher Waller and Michelle Bowman. Trump appointee Stephen Miran, whose term has expired but has continued to serve, will leave after Kevin Warsh is confirmed as chair.
Powell’s decision to stay resolves for the moment a key question that hovered over the Federal Open Market Committee meeting.
Markets already had largely expected to keep its key interest rate steady, with the bigger question over Powell’s future. Powell’s tenure as chair ends next month, but he has two years remaining on his seat as governor.
The chair, who has served eight years, congratulated his appointed successor Warsh, whose nomination cleared a pivotal hurdle earlier Wednesday when the Senate Banking Committee voted to move Warsh forward to the full floor for a vote.
“I plan to keep a low profile as a governor,” Powell said. “There’s only ever one chair. … When Kevin Warsh is confirmed and sworn in, he will be that chair.”
Beyond Warsh, Powell addressed the intense criticism he has faced from Trump, who appointed Powell to the job during his first term in office.
Powell called Trump’s often-personal criticism “unprecedented in our 113-year history” and said he’s concerned about the impact on the institution.
“I worry that these attacks are battering the institution and putting at risk the thing that really matters to the public, which is the ability to conduct monetary policies without taking into consideration political factors,” he said. “It is so important for our economy, for the people that we serve, that they can depend, over time, on a central bank that operates that way, free of political influence.”
The Justice Department’s investigation of the building renovations has been at the core of the latest controversy.
U.S. Attorney Jeanine Pirro had subpoenaed Powell but a court threw out the effort, which Pirro vowed to appeal. Pirro in recent days referred the investigation to the Fed’s inspector general, removing the criminal element and helping clear a political roadblock that had threatened to stall Warsh’s confirmation.
However, Pirro has said she would reopen the matter if there is evidence of criminal wrongdoing.
For his part, Powell had vowed to stay on until the investigation was “well and truly over.” While saying he was satisfied with recent developments, he has decided to stay, saying the events in recent months heavily played into his thinking.
“The things that have happened really in the last three months have, I think, left me no choice but to stay until I see them through at least that long,” he said.