‘Integrity is priceless’: Powell closes out eight years at the helm of the Fed

By Elisabeth Buchwald, CNN

(CNN) — After eight years spanning three administrations, 66 interest-rate-setting meetings, a pandemic, a criminal probe and countless attacks from the Trump administration, Jerome Powell capped his final policy meeting as chair of the Federal Reserve on Wednesday.

But he’s not going far: While Powell’s term as chair ends on May 15, he’ll stay on the Fed’s rate-setting committee, serving out a concurrent term as governor.

Powell said Wednesday he found it necessary to stay on until a recently closed Department of Justice probe into his actions “is well and truly over with transparency and finality.”

The decision to stay, while atypical for an outgoing chair, is reminiscent of Powell’s tenure, in which he’s been fiercely protective of the central bank’s independence. That’s been true even when it meant defying pressure from politicians on both sides of the aisle and unsettling investors.

“I have a job that I’m sworn to do, and all I think of is how much people rely on us to get it right,” Powell said in congressional testimony last year. “It’s not an easy job, but it’s one we’ve willingly taken on.”

When asked Wednesday how he’d like his stewardship at the Fed to be remembered, Powell told reporters that’s for “someone else to say.”

Fair enough. Here are some of the ways his tenure speaks for itself.

Pandemic-era Powell

Powell convened an emergency monetary policy meeting on March 3, 2020, as coronavirus cases were adding up. In the first emergency meeting since the 2008 global financial crisis, officials cut interest rates by half a percentage point.

“We do recognize that a rate cut will not reduce the rate of infection. It won’t fix a broken supply chain. We get that. We don’t think we have all the answers,” he said. But looser rates could at least boost some parts of the economy.

Less than two weeks later, he convened a second emergency meeting, this time on a Sunday. The Fed lowered rates by a full percentage point to near-zero levels.

“With little warning, economies around the world came to a hard stop. Critical financial markets were near collapse. The possibility of a long, severe, global depression was staring us in the face,” Powell recounted in a Princeton University commencement address last year.

“Everyone turned to the government, and to the Federal Reserve in particular as a key first responder. Career civil servants at the Fed who are veterans of previous crises stepped forward and said, ‘We got this,’” Powell told graduates at his alma mater.

Powell the inflation fighter

A nascent economic recovery, a wave of stimulus money and still-malfunctioning supply chains began pushing up post-pandemic inflation.

The Fed hesitated to raise rates to combat higher inflation. Powell argued that the inflation was “transitory” and that as the economy returned to normal, price hikes would slow.

But in November 2021, Powell told senators that “it’s probably time to retire ‘transitory.’” Three months later, the Fed raised interest rates by a quarter-point. Still, inflation hit a 40-year high shortly after.

That forced the Fed to take aggressive action.

In an unusually terse address to attendees at the Kansas City Fed’s Jackson Hole Symposium in August 2022, Powell warned households and businesses were due to experience “some pain” as the central bank continued to raise borrowing costs.

“These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain,” Powell said in the address. Investors sent the Dow Jones Industrial Average down by 1,000 points, or 3%.

At the Fed’s next meeting, central bankers raised rates by three-quarters of a point, an usually large hike compared to traditional quarter-point moves.

Powell the independence defender

When Trump nominated Powell in November 2017, he called him “strong, committed and smart.”

”And if he is confirmed by the Senate, Jay will put his considerable talents and experience to work leading our nation’s independent central bank,” Trump went on to say at a Rose Garden event.

Less than a year later, as the Fed began raising interest rates, Trump changed his mind. He started criticizing Powell, even though the Fed chair has always been just one of the 12 officials voting on rates.

Trump ramped up his insults in his second term: “Mr. Too Late,” “a complete moron,” “major loser,” “fool,” “truly one of the dumbest,” and “numbskull,” among others.

Powell largely stayed mum until Trump’s Department of Justice opened a criminal investigation into Powell over congressional testimony regarding the central bank’s multibillion-dollar renovation project.

The investigation prompted Powell, usually staunchly apolitical, to take a stand against Trump.

“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions or whether instead monetary policy will be directed by political pressure or intimidation,” Powell said in a highly unusual video statement released after news of the criminal inquiry broke.

Powell also stood by Fed Gov. Lisa Cook in a Supreme Court in a case that will determine whether Trump has the ability to fire her over alleged – but unproved and uncharged – mortgage fraud.

“That case is perhaps the most important legal case in the Fed’s 113-year history,” Powell told reporters in January, defending the Fed’s independence.

Powell up close

Powell has often opened up about his own path to perhaps the most powerful position in international economics.

He’s spoken candidly about how he never anticipated entering a career in economics. He told Priceton graduates he brushed off his parents’ suggestion to major in it because he thought it was “boring and useless.”

He had no plan for what to do after graduation and wound up “putting labels on shelves in a warehouse for six months,” he said. “I didn’t feel great about that.”

One message he’s emphasized repeatedly: integrity.

“Integrity is priceless,” Powell said in a 2024 “60 Minutes” interview. “And at the end, that’s all you have.”

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