Federal Reserve Chair Jerome Powell said he will remain on the Fed’s Board of Governors after his term as chair ends on May 15, rather than stepping down immediately. Because his separate term as a governor runs until January 2028, the move is legally permitted and would make him the first Fed chair since 1948 to stay on the board after leaving the top post.
Decision tied to investigation timeline
Powell made the announcement at what he described as his final press conference as chair. He said the decision is linked to the Justice Department’s criminal investigation into the Federal Reserve headquarters renovation project. According to Powell, he had previously stated that he would not leave the board until the matter was resolved in a transparent and final way. The U.S. attorney for the District of Columbia ended the criminal probe on April 24, 2026, and the Justice Department said it would not reopen the case unless the Fed’s inspector general makes a criminal referral.
Powell said the latest developments were encouraging, but added that he would continue monitoring the remaining steps in the process. He also noted that he intends to keep a low profile while serving as a governor.
Succession and board politics in focus
On succession, Powell congratulated Kevin Warsh, President Trump’s nominee to replace him as chair. Warsh advanced through the Senate Banking Committee on April 29 by a 13-11 vote, with full Senate confirmation expected during the week of May 11. Powell said he will continue serving as chair until Warsh is sworn in, emphasizing that the Federal Reserve Board has only one chair at a time.
By staying on the board, Powell avoids creating an immediate additional vacancy. That means the White House would not gain the ability to quickly fill another seat on top of installing a new chair. The decision comes after repeated clashes between Trump and Powell over the past year, giving the move broader institutional and political significance.
Rates unchanged as inflation stays above target
Separately, the Federal Open Market Committee kept the federal funds rate unchanged at 3.5% to 3.75%. Powell said headline PCE inflation rose 3.5% in the 12 months through March, while core PCE, excluding food and energy, increased 3.2%. Both remain above the Fed’s 2% target. The unemployment rate held at 4.3% in March.
Powell said slower job growth reflects lower labor-force participation, reduced immigration, and softer labor demand. On policy, he stressed that the Fed is not on a preset course and will continue making decisions meeting by meeting, especially as uncertainty has increased due to Middle East tensions and higher global oil prices.
Markets reacted unevenly after the announcement. In crypto, bitcoin traded at $75,839, down 0.66% over 24 hours, while ether changed hands at $2,247, down 1.87% on the day. How long Powell ultimately remains on the board will depend on when he considers the related legal process fully concluded.