When Jerome H. Powell was sworn in as chair of the Federal Reserve in February 2018, the unemployment rate stood at 4.1% and the US economy had added 2 million jobs over the previous year.
The S&P 500 (^GSPC) was at 2,650. The 10-year Treasury yield stood at 2.85%. And the Fed’s benchmark interest rate stood in a range of 1.25% to 1.5%.
President Trump’s first year in office saw stocks soar to record highs, corporate taxes slashed, and optimism about the US economy abundant.
By the end of the year, Powell had raised rates four times, pushing them to their highest level in a decade. The stock market would cap off its worst calendar year since the financial crisis, and the president who had nominated the lawyer turned private equity executive to lead the Federal Reserve was raging against his pick on social media.
Jay Powell’s tenure was only beginning to take shape.
Powell’s term in 2019 appeared to be winding familiar central banking grounds: Did the Fed’s inflation mandate need changing? How would the Powell Fed set the groundwork for a rate cut less than a year after its final hike? With the economy and labor market set to begin a new decade of growth after a decade of repair, what role would this central bank play?
The 2020 pandemic ushered in a return to an era of zero interest rates, and with it came the opening of the global economy’s Pandora’s box: free money. Stimulus checks were sent to Americans in three waves between March 2020 and January 2021, and what followed was the most serious bout of inflation in 40 years. A misreading of what would follow three rounds of pandemic stimulus defined the Powell years — the price increases were not transitory.
After Trump’s defeat to Joe Biden in the 2020 election, that Powell would be renominated to the post never seemed in doubt. In 2022, Powell was named to another four-year term leading the Fed.
Former President Joe Biden and Fed Chair Jerome Powell in the Oval Office of the White House in Washington, D.C., on May 31, 2022. (Saul Loeb/AFP via Getty Images) ·SAUL LOEB via Getty Images
Aggressive rate hikes aimed at taming inflation crushed stocks in 2022. Biden’s political agenda never recovered. When Trump won the presidency for the second time, he returned to the White House with Jay Powell — a man he had called “clueless” and “a bonehead” — still leading the US central bank.
Social media insults followed. But so too did a criminal investigation into costs associated with the renovation of the Federal Reserve’s headquarters, the Mariner Eccles Building, in Washington, D.C. This protracted legal battle eventually led to Powell issuing a defiant statement on a Sunday evening disclosing the investigation, plus a memorable photo opp of Powell and Trump, each donning suits and hard hats, debating the specifics of construction plans for the assembled press.
By April 2026, Trump had his nominee to replace Powell — Kevin Warsh — and Powell took the dais for a final time and said that while his time as Fed chair would be ending, he planned to remain on the Federal Reserve’s Board of Governors.
“I plan to keep a low profile as a governor,” Powell said.
After one of the most high-profile tenures as chair in Fed history, we have our doubts.
Key moments from Jay Powell's 8 years leading the Fed
March 21, 2018: Fed raises rates in Powell’s first meeting as chair
The newly installed Fed chair oversaw a widely expected quarter-point hike that increased the central bank’s benchmark interest rate to a range of 1.5% to 1.75%. That marked the sixth rate hike since the Fed began raising rates from near zero in December 2015.
In his inaugural press conference, Powell advocated for continued gradual increases in interest rates to slowly scale back accommodative policy and sustain the economic expansion. —Jennifer Schonberger
Powell hadn’t even served six months before it was clear he was in for a bumpy political ride.
The first criticism was tame by President Trump’s standards. He told CNBC he was “not thrilled” by an early interest rate increase but that Powell was “a very good man.”
Plenty more insults and attacks followed. —Ben Werschkul
Aug. 24, 2018: Powell goes celestial in first Jackson Hole speech
Fed chairs are famous for using the annual conference in Jackson Hole, Wyo., to deliver a major overarching policy message.
In Powell’s first appearance in that forum, he delivered what would be one of the most memorable speeches of both of his terms. He compared setting interest rates to a captain navigating by the stars, but with “cloudy skies.”
Powell would later revisit this theme in 2023, stating that while navigating by the stars under cloudy skies remains the challenge, the Fed is committed to bringing inflation down to its 2% target. —Jennifer Schonberger
Aug. 21, 2019: Trump calls Powell ‘a golfer who can’t putt’
March 3, 2020: With coronavirus spreading, Fed cuts rates by 50 basis points
With the Fed judging the spread of the novel coronavirus to be a “material change” to the central bank’s economic outlook, policymakers enacted an impromptu, unanimous half-percentage-point cut to the benchmark interest rate.
“Of course, the ultimate solutions to this challenge will come from others, particularly health professionals,” Powell said in a press conference. “We can and will do our part, however, to help keep the US economy strong as we meet this challenge.” —Molly Moorhead
This map from 2020 shows the early spread of coronavirus, later known more widely as COVID-19. ·Yahoo Finance
March 15, 2020: Federal Reserve slashes rates to zero in emergency Sunday announcement
As COVID cases — and economic fears — quickly spread, the Fed took emergency action on a Sunday afternoon in mid-March 2020, slashing rates by a full percentage point to zero for the first time since the financial crisis in 2008.
The move came less than two weeks after it had already made an impromptu 50 basis point cut. The central bank also announced it would buy $700 billion in Treasurys to ease borrowing costs further and said it would use a “full range of tools” to cushion the economy.
Powell warned that economic growth would weaken and said he expected to keep rates at zero until the Fed was confident the economy had weathered recent events. —Jennifer Schonberger
Aug. 27, 2020: Powell announces shift in inflation target
In August 2020, during his marquee annual speech in Jackson Hole, Powell announced a major shift in the Fed's long-term inflation framework. The central bank moved to what it called average inflation targeting, meaning it would tolerate inflation moderately above 2% for some time to make up for periods when it ran below that target, prioritizing a “broad-based and inclusive” recovery in the job market.
The new policy was the culmination of the first-ever public review of the central bank’s monetary policy framework. “Following periods when inflation has been running below 2%, appropriate monetary policy will likely aim to achieve inflation moderately above 2% for some time,” Powell said.
But the change in framework would come to haunt the Fed and the economy. —Jennifer Schonberger
April 28, 2021: Fed policy statement describes inflation as ‘transitory’
“The COVID-19 pandemic is causing tremendous human and economic hardship across the United States and around the world,” Fed officials wrote in their policy statement following a meeting in which they held interest rates steady at a range of 0% to 0.25%.
“Amid progress on vaccinations and strong policy support, indicators of economic activity and employment have strengthened. The sectors most adversely affected by the pandemic remain weak but have shown improvement. Inflation has risen, largely reflecting transitory factors.”
Transitory. Meaning temporary.
The Fed reasoned that prices were rising on account of supply shocks from bottlenecks in global supply chains, but the impacts would not be long-term or persistent. Thus, there was no need to aggressively raise interest rates to reel in inflation.
The Personal Consumption Expenditures index, the Fed’s favored inflation gauge, stood at 3.6% at the time. By the end of 2021, it hit 6.14% and peaked at 7.24% in June 2022, the highest level since 1980.
Powell later acknowledged the miscalculation but said Fed officials were not alone in thinking high inflation would be short-lived. “The good ship Transitory was a crowded one,” he said. —Molly Moorhead
Powell earned a Democratic nod when former President Joe Biden announced his plan to renominate Powell after months of deliberations. It was the latest in bipartisan presidential support for Powell, who was first selected as a governor by former President Barack Obama and then elevated by Trump.
A few days later, on Nov. 30, Powell spoke before Congress and acknowledged that inflation would continue to be a problem.
When pressed on his previous use of the term “transitory” to describe inflation, he said the term can have “different meanings to different people.”
“It’s probably a good time to retire that word and try to explain more clearly what we mean.” —Ben Werschkul
March 16, 2022: Fed begins its inflation fight
After months of insisting inflation would ease, Powell and the Fed began their most consequential policy pivot: raising rates for the first time since 2018. The initial move was modest — a quarter-point increase to a range of 0.25% to 0.5% — but it marked the start of an aggressive campaign to restore price stability.
By June, the Fed had shifted into a much higher gear, approving a 75 basis point hike, its largest move since 1994. The cycle eventually lifted the fed funds target range to 5.25% to 5.5% by July 2023, reshaping markets, housing, banking, and the broader economy. Powell’s legacy would increasingly be defined by whether that inflation fight could end without a severe recession. —Jared Blikre
Aug. 26, 2022: Powell braces the public for higher rates for longer
Dealing with the most stubborn inflation in 40 years, Powell said at the Jackson Hole forum that the Fed would raise rates as high as necessary and keep them there “for some time” to bring down inflation, warning that this would come with “pain” for Americans.
Inflation that erupted from supply chain bottlenecks post-pandemic had pushed inflation to more than three times the Fed’s 2% goal.
In an unusually brief speech, the Fed chair cautioned that bringing down inflation would likely require a period of lower economic growth.
“While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” Powell said. “These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.”
The speech caused the market to swoon 1,000 points.
Powell drove home the point, saying the Fed would “keep at it until we are confident the job is done.” —Jennifer Schonberger
March 22, 2023: Press conference after Silicon Valley Bank ‘failed badly’
The Silicon Valley Bank logo seen in March 2023. (Reuters/Dado Ruvic/Illustration) ·REUTERS / REUTERS
Twelve days after regulators seized Silicon Valley Bank in what was then the second-largest bank failure in US history, Powell gave his initial thoughts on what prompted the regional lender’s demise.
Management “failed badly,” he said in a press conference.
“These are not weaknesses that are there at all broadly through the banking system,” Powell said, naming Silicon Valley Bank’s high percentage of uninsured deposits and large investment in longer-duration bonds as sources of weakness. “The banking sector remains sound and resilient.”
Along with then-Treasury Secretary Janet Yellen, Powell and other bank regulatory heads pledged to cover all depositors at Silicon Valley Bank and another failed institution, Signature Bank. The move did not immediately squash the banking sector’s tumult.
Shares of some other regional banks faced weeks of pressure. Before the frenzy slowed, regulators would seize an even larger regional bank, First Republic Bank. And over the same weekend, that failed institution would be sold to the country’s biggest bank, JPMorgan Chase.
In the months after, bankers and investors began referring to the spring of 2023 as a mini banking crisis, and the turbulent moment would be used by bankers, politicians, and regulators alike to argue for and against more bank regulation. —David Hollerith
Sept. 18, 2024: Fed begins cutting rates
Against the backdrop of a presidential election in the fall of 2024, the Fed cut rates by an unexpectedly large half a percentage point and charted a course for two additional cuts that year.
Powell had set the table in his speech in Jackson Hole that August, noting that the job market had weakened more than thought, while factors that would push up inflation had lessened. He said the “time had come” for rates to come down.
Powell stressed in that speech that the Fed would “do everything we can to support a strong labor market.”
The move to cut by 50 basis points in September prompted criticism from Republicans that the Fed was cutting to help the incumbent Democratic Party, while the financial community questioned whether the central bank was behind the curve. —Jennifer Schonberger
April 17, 2025: After being reelected, Trump debuts a new moniker: ‘Too Late’
July 24, 2025: Trump tours the Federal Reserve renovations with Powell
In a rare visit to the Fed’s headquarters, Trump donned a hard hat and toured the construction site alongside Powell after controversy erupted over reported lavish changes that led to cost overruns in the $2.5 billion renovation.
Powell testified before the Senate Banking Committee earlier that summer that media reports about the renovations were misleading and inaccurate. He told lawmakers there were no “special elevators,” new water features, or rooftop gardens, disputing claims made by Office of Management and Budget Chair Russell Vought that Powell was leading an “ostentatious” office renovation project that may be “violating the law.”
The Trump administration seized on those comments and decided to have a look firsthand. Powell and the president disagreed publicly on-site about the cost of the project’s overruns. Trump claimed the price tag had increased to $3.1 billion — an amount Powell disputed.
“We’re just taking a look at what’s happening,” the president said of the reason for the visit. He acknowledged the complexity of the multiyear renovation project and noted that he saw “a lot of very expensive work, there’s no question about it.” —Jennifer Schonberger
Jan. 11, 2026: Powell makes extraordinary video statement, revealing he’s being investigated
In a move that sent shockwaves through the financial industry and markets, Powell revealed in a video released on a Sunday night that the Justice Department had served the central bank with grand jury subpoenas, threatening a criminal indictment related to Powell’s testimony about the Fed building.
Powell suggested the action wasn’t so much about his testimony as it was about a difference of opinion on interest rates. In a statement, he stressed what he called “unprecedented action” that should be seen in the broader context of the administration’s threats and ongoing pressure.
“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation,” Powell said in a recorded video. —Jennifer Schonberger
April 29, 2026: Powell announces he will remain at the Fed after his term as chair ends
At what was expected to be his final press conference as Fed chair, Powell made clear he was not leaving the central bank entirely.
Powell said he would remain on the Fed’s Board of Governors after his term as chair ends on May 15, keeping a seat inside the institution as Kevin Warsh prepares to take over as chair. He said he would serve as governor “for a period of time to be determined” and keep a “low profile,” language that suggested a temporary role rather than a plan to serve out the rest of his governor term, which ends in 2028.
The decision came after months of legal and political pressure from the Trump administration, including scrutiny tied to the Fed’s headquarters renovation. Powell framed his continued presence as part of a broader defense of the Fed’s independence, while also pledging not to act as a “shadow Fed chair.” —Jared Blikre
