Central Bank: the business angle

Federal Reserve Chair Jerome Powell’s decision to stay on the central bank’s board as a governor once his term as chair expires on May 15 is a great example of how President Donald Trump’s authoritarian pressure tactics can backfire. Central Bank has emerged this Friday as one of the stories drawing attention in New Zealand.

Key facts

• Federal Reserve Chair Jerome Powell’s decision to stay on the central bank’s board as a governor once his term as chair expires on May 15 is a great example of how President Donald Trump’s authoritarian pressure tactics can backfire.
• Governor Stephen Miran, as he has done since joining the central bank in September 2025, dissented in favor of a quarter percentage point cut.
• Warsh has spoken of reopening the accord and modernizing it for the current era where the central bank's fixed income holdings total some $6.7 trillion.
• As my colleague Hayes Brown observed in a recent column, Powell knows that what’s at stake is the entire reputation of the central bank:.
• An unusually divided Federal Reserve on Wednesday held its key interest rate steady as policymakers grappled with the policy impact of persistent inflation and awaited a looming leadership transition at the central bank.

What we know

Going deeper, Governor Stephen Miran, as he has done since joining the central bank in September 2025, dissented in favor of a quarter percentage point cut.

On the substance, Warsh has spoken of reopening the accord and modernizing it for the current era where the central bank's fixed income holdings total some $6.7 trillion.

Beyond the headlines, as my colleague Hayes Brown observed in a recent column, Powell knows that what’s at stake is the entire reputation of the central bank:.

More precisely, an unusually divided Federal Reserve on Wednesday held its key interest rate steady as policymakers grappled with the policy impact of persistent inflation and awaited a looming leadership transition at the central bank.

It is worth noting that Separately, during a news conference following the central bank's decision, Powell signaled that he would remain on the Board of Governors for an indefinite period.

By the numbers

At this stage, although Powell’s term as chair is ending, his tenure as one of the seven governors on the board doesn’t expire until 2028.

On a related note, Warsh, Trump’s pick for the new Fed chair, displayed a red flag at his Senate hearing last week when he refused to straightforwardly say whether Trump lost the 2020 election.

Going deeper, He is due to step down from the top job in mid-May, although his term as a Fed governor doesn't expire until January 2028.

On the substance, In what may have been Chair Jerome Powell's final meeting at the helm, the rate-setting Federal Open Market Committee voted to hold the benchmark funds rate in a range between 3.5%-3.75%.

What they're saying

“I’m literally staying because of the actions that have been taken,” Powell said at a news conference Wednesday when he was asked whether his decision would be seen as a political act. “I have long planned to be retiring.”

The wider context

On a related note, Attorney Jeanine Pirro recently handed over a Justice Department probe into renovations at the Federal Reserve's headquarters to the central bank's inspector general.

Going deeper, the president’s authoritarian attempt to take control of interest rates blew up in his face.

On the substance, the Federal Reserve on Wednesday released its latest decision on interest rates.

Beyond the headlines, an unusually divided Federal Reserve held its key interest rate steady.

More precisely, Earlier in the day, the Senate Banking Committee in a party-line vote advanced Trump's nomination of Kevin Warsh as the next Fed chair.

The bottom line

• As my colleague Hayes Brown observed in a recent column, Powell knows that what’s at stake is the entire reputation of the central bank:.
• An unusually divided Federal Reserve on Wednesday held its key interest rate steady as policymakers grappled with the policy impact of persistent inflation and awaited a looming leadership transition at the central bank.
• The president’s authoritarian attempt to take control of interest rates blew up in his face.
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