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It's set to be Jerome Powell's last meeting as Fed chair -- as a big change looms

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− Scott Horsley The Senate Banking Committee voted Wednesday to approve Kevin Warsh's nomination to serve as the next chairman of the Federal Reserve.
+ Scott Horsley Jerome Powell held what's likely to be his last meeting as Fed chair, with questions lingering about whether he'll opt to remain on the central bank's board.
− Sophie Park/Getty Images hide caption Change is coming to the Federal Reserve — even as interest rates are holding steady.
+ Sophie Park/Getty Images hide caption Federal Reserve Chair Jerome Powell said on Wednesday he would remain on the board "for a period of time to be determined" even after stepping down as chair when his term at the helm of the central bank expires on on May 15.
Economy Trump keeps pressuring the Fed to cut rates.
− Here's why its independence matters The central bank decided to leave its benchmark interest rate unchanged Wednesday, at what is likely Jerome Powell's last policy meeting as Fed chairman.
+ Here's why its independence matters Powell said he had been "encouraged by recent developments" after the Department of Justice dropped a criminal investigation into the Fed and said he would be watching "the remaining steps in this process carefully." But he reiterated he would only consider stepping down until "this investigation is well and truly over." "My concern is really about the series of illegal attacks on the Fed, which threaten our ability to conduct monetary policy without considering political factors," Powell said in a news conference, calling the Trump administration's legal actions "unprecedented" in the Fed's history. "I worry that these attacks are battering the institution and putting at risk the thing that really matters to the public, which is the ability to conduct monetary policy without taking into consideration political factors," he added. Powell's comments came after the central bank decided to leave its benchmark interest rate unchanged Wednesday, at what is likely to be his last policy meeting as Fed chairman — but it was a divided vote signaling the uncertain path facing the Fed.
His replacement may soon be in place, ushering in a change at the helm of the central bank after Powell's more than eight-year tenure. The Senate Banking Committee voted 13-11 along party lines Wednesday to endorse President Trump's nominee to replace Powell, Kevin Warsh. That sets the stage for a confirmation vote by the full Senate in time for Warsh to take over as Fed chairman when Powell's term expires next month.
+ Powell said he would welcome Warsh. "I plan to keep a low profile as a governor. There's only ever one chair of the Federal Reserve Board. When Kevin Warsh is confirmed and sworn in, he will be that chair," Powell told reporters during a news conference after the Fed's decision was released.
That timing was uncertain just a few days ago. Sen. Thom Tillis, R-N.C., had threatened to block a vote to protest the Justice Department's investigation of the Fed, which was widely seen as part of a White House pressure campaign to force the central bank to lower interest rates. That roadblock was cleared on Friday, when federal prosecutors agreed to drop their probe. "With the assurances from the Department of Justice that the case is completely and fully settled," Tillis told NBC's Meet the Press, "I am prepared to move on with the confirmation of Mr. Warsh. I think he's going to be a great Fed chair." The top Democrat on the committee was not convinced the criminal probe is finished. "No one is fooled," Sen. Elizabeth Warren, D-Mass., said before the vote. "Trump is still going after control of the Fed, and he is keeping the threat of bogus criminal charges alive until he gets what he wants." Warsh has argued that there's room to cut interest rates without sparking more inflation — thanks in part to the productivity gains promised by artificial intelligence. But he also told Senators he would act independently and not take marching orders from the president. "The president never asked me to commit to interest rate cuts at any particular meeting over the period of my tenure at the Fed," Warsh said during his confirmation hearing last week. "He didn't ask for it. He didn't demand it. He didn't require it. And nor would I have ever done so." Even if he wanted to do the president's bidding, Warsh couldn't do so on his own. Interest rates are set by a 12-person committee and the chair only gets one vote.
+ One member of the rate-setting committee, Stephen Miran, voted for a rate cut on Wednesday, while three others said they wanted stronger language against inflation.
− Other members of the committee have expressed reservations about cutting rates when inflation remains elevated and the war with Iran has triggered a big spike in energy prices.
+ The committee statement notes that inflation pressures have increased thanks to a spike in energy prices caused by the war with Iran.
− Powell could choose to retain a vote on the committee.
+ By opting to stay on the Fed's board for now, Powell will retain a vote on the committee.
− While his term as chair is coming to a close, Powell has the option to remain on the Fed's governing board through 2028.
+ Although his term as chair is coming to a close, Powell can remain on the central bank's governing board through 2028.
− That would be unusual, since most Fed chairs have stepped away completely when their terms were up.
+ His decision to stay on is unusual, since most Fed chairs have stepped away completely when their terms were up.
+ On Wednesday, Powell denied he was staying on the Fed's board to prevent Trump from getting an opportunity to fill a vacancy.
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− Americans weigh options for saving gas But Powell is a fierce defender of the Fed's ability to act independently of the White House.
+ Americans weigh options for saving gas "I'm literally staying because of the actions that have been taken," Powell said referring to the Trump administration.
− And he might see staying on the board — and denying Trump the opportunity to fill a vacancy — as another way to protect that independence. "I will make that decision based on what I think is best for the institution and for the people we serve," Powell told reporters last month. Powell will surely be asked for an update on his plans when he meets with reporters Wednesday, possibly for the last time. Sponsor Message Become an NPR sponsor
+ "I had long planned to be retiring," he added. "The things that have happened, really, in the last three months, I think, left me no choice but to stay until I see them through at least that long." Sponsor Message Become an NPR sponsor