He held his final post-meeting press conference, an event closely followed by market participants. And whilst, as always with this Princeton model student, his manner was measured and skilfully crafted, behind the fa\u00e7ade one can sense signs of a transition that is less smooth than usual at the helm of the world\u2019s most powerful central bank. Admittedly, Jerome Powell stated that, whilst he intended to remain on the Board of Governors as permitted by law, he would not act as a \u201cshadow chairman\u201d, leaving it to his successor, Kevin Warsh, to embody the Fed\u2019s new direction. Yet the rifts within the institution are no less apparent.<\/p>\n\n\n\n
Ironically, whilst Jerome Powell is regarded as a consensus-builder, his final meeting ended with the highest number of dissenting votes since the 1990s. As usual, Stephen Miran, appointed by Trump, opposed maintaining the status quo on interest rates, favouring a 0.25% cut. However, three other governors also dissented, albeit in the opposite direction. Whilst Beth Hammack, Neel Kashkari and Lorie Logan supported the decision to keep rates unchanged, they opposed the maintenance of an accommodative bias in the FOMC statement1<\/sup>. This dual split symbolises the two opposing forces facing the Fed, which future Chair Kevin Warsh will have to try to reconcile.<\/p>\n\n\n\n On the one hand, Donald Trump\u2019s almost obsessive desire to see the central bank cut its key interest rates, symbolised by the ultra-accommodative stance of his lieutenant Stephen Miran. On the other, a US economic reality that is increasingly incompatible with such a policy direction. Core inflation, as measured by the PCE2<\/sup> index used by the Fed, stands at 3.2%, well above the central bank\u2019s targets. And whilst this figure is partly due to the delayed impact of tariff hikes, which should fade in the coming months, it does not factor in any potential second-round effects linked to the situation in the Middle East. As for the Fed\u2019s other mandate, employment, the situation is improving significantly. The latest figures, along with revisions to 2025 data, support the view that the US labour market, having hit a low point last summer, is now at the start of a phase of renewed acceleration.<\/p>\n\n\n\n Whilst this situation obviously does not call for monetary tightening, given the already high real interest rates in the US, it does not justify the sharp rate cuts that Donald Trump continues to advocate. This raises what could be the key question for the Fed in the coming months: what of its independence? Whilst Jerome Powell has always presented himself as the guardian of its autonomy, he appeared rather concerned in the closing moments of his final press conference, which turned into a plea for the central bank\u2019s independence, which he now considers to be \u2018at risk\u2019.<\/p>\n\n\n\n who assured the Senate during his confirmation hearing that he would not allow himself to be influenced by the occupant of the White House. A way of signalling to him that, although he says he \u201ctakes him at his word\u201d, he will act as a safeguard should Kevin Warsh be tempted to blindly follow presidential directives in defiance of economic reality. In short, Jerome Powell has delivered his final speech as Fed Chair, but he may not have had his final say.<\/p>\n\n\n\n __<\/p>\n\n\n\n 1<\/sup>Federal Open Market Committee __<\/p>\n\n\n\n Disclaimers After more than eight years at the helm of the US Federal Reserve (Fed), Jerome Powell chaired his final monetary policy committee meeting on 26 April.<\/p>\n","protected":false},"author":5,"featured_media":1436311,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ngg_post_thumbnail":0,"footnotes":""},"categories":[220],"tags":[],"class_list":["post-1445425","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opinion-leaders-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts\/1445425","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/comments?post=1445425"}],"version-history":[{"count":1,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts\/1445425\/revisions"}],"predecessor-version":[{"id":1445426,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts\/1445425\/revisions\/1445426"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/media\/1436311"}],"wp:attachment":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/media?parent=1445425"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/categories?post=1445425"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/tags?post=1445425"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
2<\/sup>Personal Consumption Expenditure Price Index<\/p>\n\n\n\n
<\/strong>These data and opinions from LFDE, as well as the sectors mentioned, are provided for information purposes only and, as such, do not constitute an offer to buy or sell any security, nor do they constitute investment advice or financial analysis.<\/p>\n","protected":false},"excerpt":{"rendered":"