The Fed kept its benchmark rate at 3.5–3.75 percent at Jerome Powell's last meeting as chair, while Powell said he will remain on the Board until legal challenges from the Trump administration are resolved.

Rates on hold

The US Federal Reserve kept its benchmark interest rate unchanged at 3.5–3.75 percent at what was Jerome Powell's final policy meeting as chair, citing persistent inflation concerns and strain on the global economy.

Powell stays on the Board

Powell said he will not depart the Federal Reserve Board until legal challenges posed by the Trump administration are "well and truly over." The announcement signals that Powell intends to use his remaining board seat — separate from the chair role — as a bulwark for the institution's independence even after he steps down from leading the central bank.

Powell's post-meeting news conference addressed the US-Israel conflict with Iran, the inflation outlook, and what he described as legal attacks on the Fed.

Warsh nomination advances

A Senate panel approved Kevin Warsh, President Donald Trump's nominee to replace Powell as Fed chair, on a party-line vote, moving the confirmation process forward. Warsh, at his earlier confirmation hearing, denied having made any deal with Trump on interest rates and called for what he termed a "policy regime change" at the central bank. He also pushed back against suggestions that he would act as a political instrument, saying he was no "sock puppet."

Criminal probe dropped

The US Justice Department earlier dropped a criminal investigation into Powell. Trump had accused Powell of improper cost overruns in the renovation of the Fed's building. The Justice Department's decision to close that probe is expected to ease the path for Warsh's full Senate confirmation.