Powell: "Will remain a board member even after chairman's term... Fed independence at risk" (Summary)

Powell: "Will remain a board member even after chairman's term... Fed independence at risk" (Summary)

Last press conference... "Won't be a shadow chairman, just an ordinary board member"

Maintaining cautious policy stance amidst interest rate freeze... "U.S. economy quite resilient"

Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), held his final press conference as chairman on the 29th (local time) and stated that he would remain a board member for the time being even after his term ends.

Chairman Powell made this statement at a press conference held after the Federal Open Market Committee (FOMC) froze the benchmark interest rate at 3.50-3.75% on this day.

He said, "Even after my term as chairman ends on May 15, I will continue to serve as a board member for a period of time," adding, "I plan to fulfill my duties quietly (low profile) as a board member."

Regarding the U.S. Department of Justice's investigation into allegations of excessive spending on the renovation of the Fed building surrounding him, Chairman Powell said, "I have stated that I will not leave the board until this investigation is transparently, definitively, and completely concluded, and I am maintaining that stance."

He mentioned that he had recently been notified by the Department of Justice that the investigation was closed, adding, "I view the recent developments positively and am carefully monitoring the future procedures."

Regarding his decision to remain at the Fed, Chairman Powell said, "My concern is a series of legal attacks on the Fed," and "This threatens our ability to conduct monetary policy without political considerations."

He emphasized, "I want to make it clear that this is unrelated to verbal criticisms from elected officials."

Chairman Powell reiterated his criticism of the recent legal pressure against the Fed.

He said, "I am concerned that these attacks are battering the Fed and jeopardizing its ability to conduct monetary policy without considering political factors, which is important to the public."

He then stated, "As for when I will leave, I will leave when I deem it appropriate."

Regarding the criticism that 'remaining on the board is a political act,' he flatly stated, "I don't think so at all. The reason I am staying is because of the measures taken so far."

Regarding his 'quiet' role, he said, "I will never play a role like a 'shadow chairman'," and "I am returning to being an ordinary board member."

Regarding the independence of the Fed, he assessed, "I believe it is at risk."

He said, "I am confident that the Fed will make decisions in the future based on thorough and rigorous analysis, not political considerations," but added, "However, we had to fight to protect it."

Chairman Powell congratulated Kevin Warsh, the nominee for the next chairman, whose confirmation was approved by the Senate Banking Committee today. When asked if he believed Warsh would handle political pressure well, Powell said, "He testified very strongly on this during the hearing. I believe his words."

Regarding monetary policy, he reaffirmed a cautious stance.

Regarding the inflation outlook, Chairman Powell said, "It's difficult to comment on energy prices," and explained that while typically there's no need to react immediately to an energy shock, a more cautious approach is needed now because inflation has been above target for several years.

He indicated that he believes energy prices have not yet peaked and that he would confirm a decline in price increases and progress in tariff-related uncertainties before considering interest rate cuts.

He said, "No committee member advocated for an immediate interest rate hike," and "Everyone supported this interest rate decision."

He also stated that there was a much more intense discussion this time regarding whether to change the policy stance.

Chairman Powell said, "The policy rate is already at a sufficiently high level," and stated that he would observe the situation rather than rushing additional hikes or cuts. He assessed the current interest rate level as "quite close" to the neutral rate.

Regarding the Iran war, he warned that while the impact on the U.S. would be less than on Europe and Asia due to the U.S. being an energy exporter, the shock would intensify if the situation were prolonged.

Regarding the overall U.S. economy, excluding inflation, he assessed it as "quite resilient."

He explained that consumer spending is robust, business investment, such as data center construction, is expanding, and the unemployment rate (4.3%) is low. However, he noted the limited growth in new jobs, diagnosing it as an "unusual and uncomfortable state of equilibrium."