\n<\/p>\n
Jerome Powell, the former chair of the Federal Reserve, has warned that a single act of political interference in monetary policy could permanently destroy public trust in the central bank.<\/p>\n
As Donald Trump\u2019s administration continues to test the Fed\u2019s longstanding independence, Powell said in a speech on Sunday night that the institution was in the midst of a \u201cstress test\u201d.<\/p>\n
Powell, who was accepting the 2026 John F Kennedy Profile in Courage award in Boston, stepped down as Fed chair last month, and was succeeded by Kevin Warsh, but remains on its board of governors.<\/p>\n
Legal protections insulating monetary policy from politics \u201chave served the public well\u201d across administrations of both parties, Powell argued in his acceptance speech. \u201cIf any administration finds a way to remove Fed officials over policy differences,\u201d he added, \u201cthen future administrations will do so as well\u201d.<\/p>\n
He spoke as the supreme court weighs a highly anticipated decision on the fate of the Fed governor Lisa Cook, whom Trump attempted to fire last August. Powell did not mention Trump, or Cook, by name.<\/p>\n
\u201cThe public would lose faith that the central bank will make decisions based only on what\u2019s best for all Americans,\u201d Powell said. \u201cThe Fed\u2019s credibility would be lost.\u201d<\/p>\n
The JFK Library Foundation\u2019s award committee said it was honoring Powell for withstanding \u201cyears of personal attacks and threats from the highest levels of government\u201d, noting that he \u201crefused to let political forces dictate monetary policy\u201d.<\/p>\n
Fed decisions were made \u201cbased only on our best economic analysis of what would most benefit the people we serve\u201d, Powell said on Sunday. \u201cWe do not take into account the fortunes of any political party or politician.\u201d<\/p>\n
Powell repeatedly defied the US president\u2019s demands for drastic interest rate cuts. Trump\u2019s subsequent attempt to exert greater control over the Fed set the stage for a constitutional showdown that has unsettled global markets for months.<\/p>\n
Last August Trump announced he was removing Cook, citing what he described as \u201cdeceitful and potentially criminal conduct\u201d relating to mortgage transactions, marking the first time in the Fed\u2019s history that a sitting president had attempted to remove a Fed governor. Cook denied any wrongdoing and refused to leave.<\/p>\n
A federal district judge blocked the firing in September, concluding that Cook\u2019s alleged conduct could not constitute lawful \u201ccause\u201d for dismissal because it occurred before she took office. When the case reached the supreme court in January, both conservative and liberal justices signaled skepticism towards the administration\u2019s position, indicating they were unlikely to grant its request to lift the injunction while litigation continued. A final ruling is expected before the court rises for summer, typically in late June.<\/p>\n
Powell attended the January oral arguments and told reporters afterward that the case was \u201cperhaps the most important legal case in the Fed\u2019s 113-year history\u201d.<\/p>\n
On Sunday, Powell said Fed officials \u201chold office with legal protection against removal\u201d and serve \u201clong terms unrelated to the four-year presidential election cycle\u201d.<\/p>\n
Quoting the philosopher Edmund Burke, he warned that democratic institutions \u201ctake much time, effort, and patience to build but can be torn down all too quickly\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"
Jerome Powell, the former chair of the Federal Reserve, has warned that a single act of political interference in monetary policy could permanently destroy public trust in the central bank. As Donald Trump\u2019s administration continues to test the Fed\u2019s longstanding independence, Powell said in a speech on Sunday night that the institution was in the<\/p>\n","protected":false},"author":1,"featured_media":49974,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[4222,2431,24665,13578,4438,1913,4439,517,4221],"class_list":{"0":"post-49973","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-alarm","9":"tag-chair","10":"tag-exfederal","11":"tag-interference","12":"tag-jerome","13":"tag-political","14":"tag-powell","15":"tag-reserve","16":"tag-sounds"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/49973","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=49973"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/49973\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/49974"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=49973"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=49973"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=49973"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}