Powell Steps Down After 8 Years as 9.1% Inflation Surge and Trump Clashes Define Legacy
Updated
Updated · The Associated Press · May 15
Powell Steps Down After 8 Years as 9.1% Inflation Surge and Trump Clashes Define Legacy
11 articles · Updated · The Associated Press · May 15
Jerome Powell left the Fed chair after eight years with inflation and institutional independence at the center of his record, while saying he will stay on the Board until he is confident the Fed’s autonomy is restored.
9.1% inflation in June 2022 became the defining policy failure: Powell and other officials treated the post-pandemic surge as transitory, kept rates near zero until March 2022, and faced criticism that easy policy amplified demand.
The same Fed later drove its benchmark rate to a two-decade high in 2023, helping bring inflation down to 2.3% by September 2024 without the recession many economists had feared.
Trump’s pressure shaped the other half of Powell’s legacy, from repeated personal attacks to a Justice Department probe over the Fed’s $2.5 billion renovation project that Powell publicly challenged.
Kevin Warsh has been confirmed as Powell’s successor, while Powell’s broader legacy now rests on whether his inflation misread is outweighed by a rare soft landing and his defense of central-bank independence.
How will the incoming Fed Chair's 'regime change' impact borrowing costs for families and businesses?
Can the new Fed Chair tame inflation without triggering a recession amid the ongoing Iran conflict?
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Fed Leadership Shakeup 2026: Kevin Warsh Takes Helm as Chair, Powell Stays On, and Inflation Looms
Overview
In May 2026, Kevin Warsh was confirmed as the next Federal Reserve Chair, following President Donald Trump’s nomination and approval by the narrowly Republican Senate Banking Committee. Warsh, whose personal and family wealth far exceeds that of his predecessor Jerome Powell, becomes the richest Fed chair since at least 1948. His first FOMC meeting is set for June, marking the start of a new era for the central bank. Warsh’s leadership is expected to bring significant policy changes, while Powell’s unprecedented decision to remain on the Board of Governors adds a unique dynamic to the Fed’s future direction.