Jerome Powell Concludes Tenure as Federal Reserve Chair Amid Economic Challenges

"...Powell's decisions along the way held stakes as concrete as the budgets of everyday Americans and as heady as the political independence of a pillar institution...."

"...The move grants Powell a role in interest-rate policy that could last until 2028, though he says he will step down once a Fed inspector general's investigation into a renovation of the central bank headquarters is closed...."

"...The transition offers an opportunity to look back at Powell’s tenure, which spanned two presidents, three Treasury secretaries and 66 interest-rate decisions...."

"...Powell hiked interest rates four times in his first year, putting strain on the stock market but leaving the Fed in position to stimulate the economy with rate cuts in the event of a slowdown...."

"...The dropping of rates to the floor was both necessary and appropriate, and in a real sense, obvious...."

"...Powell initially downplayed the price increases, describing them as 'transitory.' It proved a consequential mistake -- and Powell would later admit his error...."

"...The aggressive series of rate hikes put the central bank’s benchmark rate at its highest level since 2001. The move sent mortgage and credit card rates soaring...."

"...By June 2023, annual inflation had plummeted to 3%, but Americans remained widely dissatisfied with price increases long afterward...."

"...Many economists forecast a recession and the type of job losses it typically entails. Fortunately, the downturn never came to pass...."

"...Inflation stayed high for too long but once it came down, it came down really fast. It came down without creating unnecessary pain in the labor market...."

"...Over the ensuing months, Trump began to slam Powell for cost overruns in a renovation project at the Fed’s headquarters in Washington, D.C...."

"...The Fed attributed spending overruns to unforeseen cost increases, saying that its building renovation would ultimately 'reduce costs over time by allowing the Board to consolidate most of its operations,' according to the central bank's website...."

"...By January, the Department of Justice had opened a criminal investigation into Powell, ratcheting up an extraordinary clash between the White House and the Fed...."

"...It was the first criminal probe of a Fed chair in the 113-year history of the central bank...."

"...The probe centered on Powell’s testimony to Congress last year about the cost overruns...."

"...Powell issued a rare video message rebuking the investigation as a politically motivated effort to influence the Fed's interest rate policy...."

"...No one -- certainly not the chair of the Federal Reserve -- is above the law...."

"...But this unprecedented action should be seen in the broader context of the administration's threats and ongoing pressure...."

"...The DOJ moved to drop its criminal probe into Powell last month...."

"...Washington U.S. Attorney Jeaninne Pirro said the investigation into the office renovation would be taken up by the Fed’s inspector general...."

"...The attack on the Fed chair was appalling...."

"...Powell stood up to it...."

"...Warsh, a former Fed official, will serve a 4-year term as chair...."

"...He is set to lead the Fed in a challenging period for central bank policymakers...."

"...Inflation rose for a second consecutive month as the U.S.-Israeli war with Iran continued to send gasoline prices surging in April, government data on Tuesday showed...."

"...Annual inflation jumped to its highest level in three years, according to the U.S. Bureau of Labor Statistics...."

"...Despite the disruption, some measures of economic health have proven resilient...."

"...The unemployment rate held steady at a historically low level of 4.3% in April, leaving it little changed from when Powell began his tenure in 2018...."

"...The economy is pretty good but far from perfect...."

"...That's the legacy that Warsh is inheriting...."