Jerome Powell Ends Fed Chairmanship, Remains on Board, Breaking 75-Year Precedent

Jerome Powell’s term as Federal Reserve chair ends on May 15, 2026, but he will remain a voting member of the Board of Governors until his board term expires in early 2028, ending a 75-year practice of former chairs resigning. The decision follows a strained relationship with President Donald Trump, who has pressed for deeper rate cuts. In early 2026 the Department of Justice opened a criminal investigation into Powell’s statements about a $2.5 billion renovation of the Fed’s Washington headquarters. Powell posted a video calling the probe “punishment by Trump.” The DOJ dropped the criminal case in late April and referred the matter to the Fed’s inspector general, leaving the inquiry unresolved.

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Key participants are Jerome Powell; President Donald Trump; the Department of Justice; Senate Banking Committee Chair Tim Scott; Senator Thom Tillis; Fed Governor Stephen Miran, a Trump appointee who dissented for a quarter-point rate cut; and Kevin Warsh, the incoming chair.

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At Powell’s final FOMC meeting the committee voted 8-4 to keep the federal funds rate at 3.50-3.75 %. Governor Stephen Miran and three other members dissented over dovish language; Powell did not join. The vote and Powell’s board stay may temper expectations for multiple rate cuts, influencing equity valuations and borrowing costs.

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Powell said he will not leave the board “until this investigation is well and truly over with transparency and finality,” and added he is “encouraged by recent developments.” Senate Banking Committee Chair Tim Scott warned that “he’s breaking 75 years of precedent…what you don’t want are these philosophies in conflict,” and said it would be best for the country and the Fed if Powell left. Senator Thom Tillis said he would withhold support for Kevin Warsh until the investigation is resolved.

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President Trump is expected to nominate a Fed chair successor and may fill Powell’s board seat before the 2028 term ends. The Fed inspector general’s report on the $2.5 billion headquarters renovation is slated for release later in 2026, and its findings could shape congressional views on future board confirmations.

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• “I've said that I will not leave the board until this investigation is well and truly over with transparency and finality, and I stand by that,” — Jerome Powell, former Fed Chair

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• “I'm encouraged by recent developments, and I'm watching the remaining steps in this process carefully.” — Jerome Powell

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• “He's breaking 75 years of precedent. Every time you get a new chairman, the former chairman leaves. That's good news because what you don't want are these philosophies in conflict,” — Tim Scott, Senate Banking Committee Chair

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• “I think for the country and for the Fed, it would be best if he left.” — Tim Scott

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