Federal Reserve Chair Jerome Powell holds likely final press conference
Powell holds likely final press conference as Fed chair Wednesday amid uncertainty over whether he'll remain on the board to protect Fed independence from Trump.
Objective Facts
The Federal Reserve announced its third rate decision of 2026 on Wednesday as officials confront rising inflation and a lackluster job market, with Powell's final press conference at 2:30 p.m. The overwhelming consensus among economists is that the Federal Open Market Committee will hold rates steady, with the CME Group's FedWatch tool showing a 100% probability that the Fed will keep its target rate within its current range of 3.5% to 3.75%. Powell steps down as Fed chair when his term concludes on May 15, and he's expected to be replaced by Kevin Warsh, whose confirmation hearing before the Senate Banking Committee was held last week. U.S. Attorney Jeanine Pirro announced Friday that her office is ending its investigation into Powell over the renovation of the Fed's Washington headquarters, and Sen. Thom Tillis said he is prepared to move forward with Warsh's nomination. The critical unresolved question is whether Powell will confirm he will remain as Fed governor once his term as chair ends, as his term on the Board of Governors runs through January 31, 2028, and he has yet to confirm whether he will step down as is customary.
Left-Leaning Perspective
Sen. Elizabeth Warren of Massachusetts, the top-ranking Democrat on the Banking Committee, said the abandonment of the Powell investigation 'is just an attempt to clear the path for Senate Republicans to install President Trump's sock puppet Kevin Warsh as Fed Chair.' Warren called the probe 'bogus' and argued that 'anyone who believes Donald Trump's corrupt scheme to take over the Fed is over is fooling themselves,' urging the Senate not to proceed with Warsh's nomination. Warren specifically noted that the Justice Department 'threatened to restart the bogus criminal investigation into Fed Chair Powell at any time while failing to drop their ridiculous criminal probe against Governor Lisa Cook,' suggesting the Trump administration's targeting of Fed officials who resist its demands continues. Left-leaning coverage emphasized that the investigation has not truly been closed but merely transferred. Warren stated the investigation 'hasn't been dropped,' citing statements from the prosecuting attorney and acting attorney general saying it's not over, and directly quoting Trump saying 'It has not been dropped.' Progressive outlets highlighted that the DOJ probe stoked fears that the Trump administration was trying to chip away at the Fed's independence, which would pave the way for political interference in setting interest rates for the world's largest economy. The left-leaning narrative portrayed Warsh as a Trump loyalist who would prove more pliable on interest rate policy than Powell has been. Left-leaning coverage downplayed Republican Sen. Thom Tillis's genuine concerns about Fed independence and instead focused on the investigation's timing—framing it as purely politically motivated. Democrats omitted discussion of the federal judge's March ruling that the DOJ subpoenas lacked merit, instead emphasizing only that the investigation remained a threat.
Right-Leaning Perspective
Sen. Thom Tillis, a North Carolina Republican, said he is willing to vote to confirm Kevin Warsh, having made clear that the DOJ's criminal investigation into Powell was 'a serious threat to the Fed's independence, and it needed to end before I could support Kevin Warsh's confirmation,' while welcoming the Inspector General's investigation as 'a necessary and appropriate measure.' Tillis stated that 'we have assurances from the DOJ that I needed to feel like they were not using the DOJ as a weapon to threaten the independence of the Fed.' Sen. Kevin Cramer expressed hope that Powell will leave the central bank, saying 'I hope not' when asked whether Powell should stay on after his term as chair expires. Right-leaning outlets and Republican officials framed the DOJ investigation's closure as a victory for Fed independence against what they characterized as a politically motivated probe. During the Senate Banking Committee confirmation hearing for Warsh, Tillis argued that 'if we put everybody in prison in federal government that had had a budget go over, we'd have to reserve an area roughly the size of Texas for a penal colony,' suggesting the investigation lacked legitimate basis. South Carolina Republican Sen. Tim Scott, chair of the Banking Committee, welcomed the news and said he is 'pleased this matter is continuing to receive' scrutiny from the Inspector General, expressing that he expects 'a full accounting of how these costs spiraled out of control.' White House spokesman Kush Desai said 'American taxpayers deserve answers about the Federal Reserve's fiscal mismanagement' and expressed confidence that the Senate will 'swiftly confirm Kevin Warsh as the next Federal Reserve Chairman.' Right-leaning coverage omitted discussion of why the federal judge found the DOJ subpoenas were issued for the improper purpose of pressuring Powell, instead treating the investigation's end as straightforward resolution of legitimate fiscal concerns about Fed building costs.
Deep Dive
Powell's final press conference arrives at a pivotal moment for the Federal Reserve's institutional autonomy. Since Trump returned to office in January 2025, he has relentlessly pressured the Fed to cut interest rates and attacked Powell personally. Powell released a statement on January 12 saying the DOJ investigation 'should be seen in the broader context of the administration's threats and ongoing pressure.' In March, a federal judge agreed, putting the brakes on the DOJ and saying its criminal investigation was part of 'an improper campaign by the Trump administration to pressure the central bank into cutting rates.' The closure of the DOJ criminal probe on Friday—coupled with Tillis's withdrawal of his blockade—clears the path for Warsh's confirmation before Powell's May 15 deadline. Yet the critical unresolved tension remains: what Powell will say about staying on as a governor. Powell set a condition in March that he wouldn't leave until the investigation was dropped 'with transparency and finality,' but Pirro said she could reopen it 'if the facts warrant doing so.' Democrats argue the investigation persists in substance even if not in name; Republicans contend it is definitively closed. Some economists worry that Warsh's stated preference for less transparent Fed communications could reduce institutional checks on Trump's influence, making Powell's potential decision to stay strategically important for 'preserving institutional continuity, anchoring the existing communication approach, and providing a stabilizing counterweight during the transition.' The Federal Reserve's traditional practice is for chairs to depart the board entirely, but precedent exists: Marriner Eccles stayed on as governor from 1948 to 1951 following the end of his chair term, during a period of tension between the Federal Reserve and the Treasury over interest rate policy. Whether Powell sees his situation as sufficiently analogous—defending Fed independence against political pressure—will likely be the subtext observers watch for in his remarks Wednesday afternoon.