Federal Reserve Chair Jerome Powell has signaled that he will maintain the same playbook as during President-elect Donald Trump’s first term, citing broad support in Congress for the central bank’s independence. With his four-year term extending through the early months of the new administration, Powell is bracing himself for a potential confrontation with the president.
Powell expressed confidence in having a constructive relationship with Treasury Secretary nominee Scott Bessent, who has publicly considered appointing a “shadow Fed chair” to undermine Powell’s authority. However, the central bank chief made it clear that he would not be swayed by pressure from the White House and will fulfill his congressional mandate regardless of external pressures.
The Fed’s independence is under scrutiny as Trump prepares to take office for the second time. The central bank has faced intense criticism in the past, but Powell’s resolve is unwavering. With his term set to expire in the first 16 months of the new administration, Powell will need to navigate a delicate balance between fulfilling his duties and resisting pressure from an unpredictable White House.
Powell’s statement on Thursday that he would not resign before the end of his term, even if Trump asked him to, has sent a clear message that the Fed’s independence is non-negotiable. As the votes for the new administration are still being counted, it remains to be seen how this will play out in practice.
Source: https://www.axios.com/2024/12/05/powell-trump-fed-scott-bessent