What Jay Powell's Final Meeting As Fed Chair Means For Kevin Warsh

The central question was whether Jerome Powell would stay on as Fed Chair. Historically, chairs have left when their terms ended, but Powell indicated he would continue as a Governor. This decision comes amid concerns about Fed independence and unprecedented threats. His continuation echoes Marriner Eccles in 1948, when the Fed also faced independence challenges. Despite a strong labor market not fueling inflation, the Fed held rates. The current inflation is attributed to supply shocks, beyond the Fed's direct control via interest rate adjustments. The committee's rate hold saw four dissents. Governor Miron favored a rate cut, a stance he's consistently held. Additionally, three regional presidents dissented against language suggesting the next move would be a cut, signaling resistance to being dictated to. This creates an interesting dynamic as Kevin Warsh is set to become the next Fed Chair.