Powell warns against political influence at Fed

Former Federal Reserve Chair Jerome Powell warned that removing Federal Reserve officials over policy disagreements could threaten the central bank’s independence and credibility.

Accepting an award for political courage from the Kennedy family, Powell focused on the importance of protecting democratic institutions and the rule of law. He described the Fed’s independence as a “priceless asset” built over decades and essential for maintaining public trust and controlling inflation.

While he avoided naming any political leader, he stressed that the Fed must remain free from political influence when setting interest rates. He said that if one administration succeeds in removing Fed officials over policy disputes, future administrations could do the same.

His remarks come as the Supreme Court is expected to rule on President Donald Trump’s attempt to remove Fed Governor Lisa Cook.

Powell also emphasized that regional Fed presidents are chosen through an independent process, helping ensure monetary policy decisions remain focused on long-term economic stability rather than short-term political goals.