The Federal Reserve is expected to hold its benchmark interest rate steady this week, and the meeting could be Jerome Powell’s last as Fed chair. Powell has led the central bank for more than eight years, and a successor may be confirmed in time to take over when his term ends next month.
A key Senate committee is scheduled to vote Wednesday on President Trump’s nominee to replace Powell, Kevin Warsh. That committee vote clears the way for a full Senate confirmation if successful. The timing had been uncertain after a Justice Department probe prompted Republican Sen. Thom Tillis to threaten blocking the vote, but with the investigation dropped, Tillis said he would move forward and offered praise for Warsh.
Warsh has suggested there may be room to lower rates without rekindling inflation, pointing in part to gains in productivity from technologies like artificial intelligence. At his confirmation hearing he emphasized his independence from the White House, saying the president did not demand rate cuts and that he would not take direct orders on monetary policy.
Still, the Fed chair does not decide policy alone. Interest-rate choices are made by the 12-member policy committee, and several officials have signaled caution about cutting rates while inflation remains elevated and energy prices face geopolitical pressures.
Powell could opt to remain on the Fed’s board through 2028, an uncommon move that would preserve his vote and constrain the number of seats the White House can fill. He has repeatedly defended Fed independence and said his future decision will be guided by what he believes best serves the institution and the public. Reporters are expected to ask Powell about his plans after the meeting concludes.