Powell says he'll stay on Fed board after chairmanship ends but won't be a 'shadow Fed chair'

• The FOMC held interest rates steady at 3.5%-3.75% in Powell's final meeting as chair, with Senate Banking Committee advancing Kevin Warsh's nomination as his successor
• Powell reversed retirement plans due to a DOJ investigation into whether he misled Congress about Fed headquarters renovations, though the probe was dropped Friday and transferred to the Fed's Inspector General
• Powell's term as Fed governor runs until January 2028, but he indicated he will leave when the investigation concludes 'with finality and transparency' and emphasized his intent to support the new chair rather than interfere

Summary: Powell to Remain on Fed Board After Chairmanship Ends

Key Developments:

Federal Reserve Chair Jerome Powell announced he will remain on the Fed's Board of Governors after his chairmanship ends next month, pledging not to act as a "shadow Fed chair." The statement came during his final press conference following the FOMC's decision to hold interest rates steady at 3.5%-3.75%.

Leadership Transition:

Powell's successor, Kevin Warsh, recently advanced through the Senate Banking Committee and is expected to be confirmed as the new Fed chair. Powell emphasized he will "keep a low profile" and respect Warsh's authority, noting "there's only ever one chair of the Federal Reserve Board."

DOJ Investigation Impact:

Powell had originally planned to retire but reversed course due to a Justice Department investigation into whether he misled Congress about the Fed's headquarters renovation project. The investigation has since been dropped by U.S. District Attorney Jeanine Pirro, who transferred the matter to the Fed's Inspector General Michael Horowitz. Courts previously quashed DOJ subpoenas, calling them a "pretext."

Fed Independence Concerns:

Powell cited "unprecedented" legal attacks threatening the Fed's ability to conduct monetary policy free from political pressure as his primary reason for staying. He stated these actions are "unprecedented in our 113-year history" and emphasized that central bank independence is "part of the absolute foundation of this amazing economy."

Term Details:

Powell's term as Fed governor extends until January 31, 2028, though he indicated he may leave sooner once the investigation concludes "with finality and transparency." Historical precedent exists: former Chair Marriner Eccles remained as governor from 1948-1951 after his chairmanship ended.