Jerome Powell Warns Political Pressure Threatens Fed Independence, Credibility in Boston Speech

Former Federal Reserve Chair Jerome Powell used an award speech at the John F. Kennedy Presidential Library in Boston to warn that the Fed is facing a political “stress test” that threatens its independence and credibility.

“Central bank faces political 'stress test' that threatens economy, ex-Fed Chair Powell says The Supreme Court is set to rule on Trump's attempted removal of a Fed governor”

ABC News

Powell said, “Like many other institutions, the Fed has been undergoing a stress test,” and argued that “Congress wisely chose to insulate monetary policy decisions from political pressure.”

ABC News

He spoke after his term as Fed chair ended on May 15 and after President Donald Trump selected Kevin Warsh to succeed him.

Powell also said, “At the Fed, we are, of course, human and thus imperfect,” and added, “When we make mistakes, we acknowledge them and change course.”

Powell warned that if an administration finds a way to remove Fed officials over policy differences, “then future administrations will do so as well,” and he said “The public would lose faith that the central bank will make decisions based only on what’s best for all Americans.”

The remarks came as the Supreme Court was set to rule on Trump’s attempted removal of Fed Governor Lisa Cook, with Cook rejecting the charges as baseless and calling them politically motivated.

Al Jazeera

ABC News described Powell’s warning as a defense of Fed independence “coming just weeks after Powell stepped down from his role as head of the central bank,” while noting Powell remains on the Federal Reserve’s 12-person board of governors.

Axios reported that Powell said the Fed’s credibility would be “lost” if officials could be removed over policy differences, and that “That credibility enables the Fed to support a strong and stable economy for the benefit of American families and businesses.”

Powell framed his defense of independent institutions beyond the Fed, telling the audience that universities, courts, Congress and the central bank are “the foundation and the embodiment of our democracy” and that the Fed’s independence is a “priceless asset” that must be protected.

“Jerome Powell uses JFK award speech to warn against political pressure on Fed, courts and schools Jerome Powell uses JFK award speech to warn against political pressure on Fed, courts and schools BOSTON (AP) — Former Federal Reserve Chair Jerome Powell used one of his first major public appearances since leaving office to defend independent institutions while accepting an award Sunday honoring his efforts to preserve the central bank’s independence”

Associated Press

He also tied the stakes to public trust, saying, “Our credibility has been built and sustained over many decades, and we have a duty to safeguard that priceless asset for our fellow citizens and for generations to come.”

The speech occurred alongside recognition for Minnesota’s Twin Cities residents at the John F. Kennedy Profile in Courage Award, including Tim Granger’s remark, “It’s wonderful just to be invited, honoring Renée,” after Renée Good and nurse Alex Pretti were killed while observing or documenting enforcement activity.

The Los Angeles Times reported that Powell stepped down as chair when his term expired in May and that he kept his seat on the Fed’s governing board until January 2028, depriving the Trump administration of an opportunity to appoint another member of the board.