Powell to Stay on Fed Board, Drawing Trump Fury
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- Jerome Powell announced Wednesday he will remain on the Fed board of governors for an undetermined period after his chairmanship ends May 15, with his separate board term lasting until January 2028
- Powell said he originally planned to retire, but cited the criminal investigation into the Fed's renovations — recently transferred to the Fed inspector general by DOJ — as the reason he now has "no choice but to stay"
- President Trump posted on Truth Social that "Jerome 'Too Late' Powell wants to stay at the Fed because he can't get a job anywhere else" and told reporters Thursday that Powell is "a negative force"
- Treasury Secretary Scott Bessent called the move a "violation of all Federal Reserve norms" and "an insult" to Kevin Warsh, Michelle Bowman, and Chris Waller, three of Trump's Fed appointees
- RSM economist Joe Brusuelas warned that Powell would almost surely dissent from the board if Warsh moves to cut rates, effectively making him "the shadow chair well into 2028"
- The last Fed chair to remain as a governor after stepping down as chair was Marriner Eccles in 1948, underscoring the unusual nature of Powell's decision
Why it matters: Powell's refusal to exit cleanly — combined with the DOJ's decision to close its criminal probe into the Fed renovations — means Trump's pick to replace him, Kevin Warsh, will inherit an entrenched governor whose separate board seat runs through January 2028, creating a built-in dissent mechanism against any aggressive rate-cutting agenda from the new chair.
