Powell Signals Staying at Fed, Potential Trump Clash
Federal Reserve Chair Jerome Powell indicated Wednesday he intends to remain in his position even after his current term expires in May, potentially setting up a protracted standoff with President Donald Trump, who has repeatedly sought his removal.
Powell’s statement, made during a press conference in Washington, came as a Department of Justice investigation into comments he made regarding the renovation of the Federal Reserve’s headquarters continues to stall the confirmation of Kevin Warsh, Trump’s nominee to succeed him. “I have no intention of leaving the board until the investigation is well and truly over, with transparency and finality,” Powell told reporters.
The investigation, initiated at the behest of the Trump administration, centers on roughly $3 billion in renovations to the Federal Reserve’s offices, a project that has drawn criticism from the President over its cost. A federal judge recently quashed the Department of Justice’s attempt to subpoena Powell, finding the effort appeared to be part of a broader attempt to pressure him into lowering interest rates, according to a ruling in the U.S. District Court for the District of Columbia. The judge cited Trump’s public statements and past criticisms of Powell as evidence of political motivation.
Senator Thom Tillis, a North Carolina Republican, has stated he will block any Federal Reserve nominees until the Justice Department investigation is dropped. With unanimous opposition from Democrats on the Senate Banking Committee, Tillis’s stance has effectively halted the nomination process for Warsh.
The escalating conflict between Trump and Powell began as disagreement over monetary policy, with Trump repeatedly urging the central bank to cut rates to stimulate the economy. The President has publicly chastised Powell and even resorted to personal insults, according to reports. Trump initially appointed Powell in 2017, but has since expressed regret over the decision, calling him “one of my worst appointments.”
The White House signaled its continued support for the DOJ investigation on Tuesday, complicating Warsh’s path to confirmation. The situation leaves the future leadership of the Federal Reserve uncertain, with Powell prepared to remain in his role indefinitely pending the outcome of the investigation.