Current Federal Reserve Chairman Jerome Powell will continue to serve on the central bank’s board as governor after his term ends in May.
Speaking at a press conference after the central bank’s decision to keep interest rates steady at 3.5%-3.75% on Wednesday, Powell expressed concern about the lawsuit against the central bank, saying it will prompt him to stay, although he plans to keep a “low profile.”
“I am concerned that these attacks are institutionalizing and jeopardizing what really matters to the public, which is the ability to conduct monetary policy without considering political factors,” Powell said.
When President Donald Trump’s administration closed its criminal investigation into Powell, it left room to revisit the case. Jeanine Pirro, the U.S. attorney for the District of Columbia, said the case would be reviewed by the Fed’s inspector general and warned prosecutors to reopen it if new facts emerge.
That statement, along with later remarks from President Donald Trump and his aides, raised concerns that Powell could still face legal pressure. Powell said that while he wanted to leave, he had “no choice” but to stay.
Fat leave rates unchanged
The Fed’s rate hike came as expected, but the dissent from three central bank governors stood out, according to 21shares macro analyst Matt Mena. “The Fed’s decision to keep interest rates steady wasn’t the shocker, but the three naysayers calling for a strike on any easing guidance threw a bucket of ice at the market pivot,” Mena said. The hawkish tone weighed on risk assets with bitcoin slipping below the $75,000 support mark as traders prepare for a retest of the $73,000 level.
The focus has also shifted to potential political changes ahead. “Markets can start to price one [Kevin] Warsh pivot favoring rate cuts, and more importantly, the impending passage of the CLARITY Act,” Mena said, adding that if momentum returns, “the path to $85,000-$90,000 looks like a clear shot.”
