Fed Chairman Jerome Powell says he will remain governor after his term despite legal pressure

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 news conference following the central bank’s decision to keep interest rates steady between 3.5% and 3.75% on Wednesday, Powell expressed concerns about the legal action against the central bank, saying they force him to stay, even as he plans to keep a “low profile.”

“I fear that these attacks will undermine the institution and jeopardize 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 open the possibility of re-examining the case. Jeanine Pirro, the U.S. attorney for the District of Columbia, said the case would remain under review by the Fed’s inspector general and warned that prosecutors could reopen it if new facts emerge.

That statement, along with subsequent remarks from President Donald Trump and his aides, raised concerns that Powell could still face legal pressure. Powell said that even though he wanted to leave, he had “no choice” but to stay.

The Fed leaves its rates unchanged

The Fed’s hold on rates went as expected, but dissent from three governors stood out, according to 21shares macroeconomic analyst Matt Mena. “The Fed’s decision to hold rates steady was not the surprise, but these three dissidents calling for a withdrawal of any easing guidance have thrown a bucket of ice on the market’s kingpin party,” Mena said. The hawkish tone weighed on risk assets, with bitcoin BTC$75,498.09 sliding below the $75,000 support bar as traders prepare for a retest of the $73,000 level.

Attention was also focused on potential policy changes to come. “Markets could begin to price a [Kevin] A Warsh pivot that favors rate cuts and, more importantly, the imminent passage of the CLARITY Act,” Mena said, adding that if momentum returns, “the path to $85,000 – $90,000 appears to be a clear path.”