Behind Powell’s High-Stakes Decision to Stay at the Fed

Over the past year, Jerome H. Powell has frequently said that the Federal Reserve faced “no risk-free paths” as it confronted a series of economic shocks that simultaneously lifted inflation while denting growth.

The same could be said for his momentous decision to stay on at the Fed as a governor after his term as Fed chair ends May 15.

In choosing to stay, Mr. Powell used the one tool of leverage he had left to push back on an administration that has aggressively attacked the central bank for its refusal to bend to the president’s demands for lower interest rates. Unless another Fed governor departs, President Trump will not have another vacancy to fill until Mr. Powell’s term ends in January 2028, stymieing the president’s plans to get more of his supporters on the powerful board of governors.

The move, which Mr. Powell announced on Wednesday at his final news conference after eight years as chair, drew an immediate rebuke from the administration. Mr. Trump quipped that Mr. Powell was staying because “he can’t get a job anywhere else — nobody wants him.” Scott Bessent, the Treasury secretary, called Mr. Powell’s decision a “violation of all Federal Reserve norms.”

Article source: https://www.nytimes.com/2026/04/30/business/powell-fed-trump.html