Jerome Powell plans to remain on the board of the Federal Reserve after his term as chair ends next month "for an undetermined period of time," saying the "unprecedented" legal attacks by the Trump administration have put the independence of the nation's central bank at risk. The Fed Wednesday left its benchmark interest rate unchanged for the third straight meeting but signaled it could still cut rates in the coming months, moves that attracted the most dissents since October 1992. The Senate Banking Committee earlier approved Powell's successor as chair, Trump appointee Kevin Warsh, on a party-line vote.
The Federal Reserve will likely keep its key short-term interest rate unchanged on Wednesday, despite harsh criticism from President Donald Trump and his demand that the Fed reduce borrowing costs. After causing a sharp drop in financial markets two weeks ago by saying he could fire Fed Chair Jerome Powell, the Republican leader backed off and said he had no intention of doing so. Still, he and Treasury Secretary Scott Bessent have said the Fed should cut rates. The heightened scrutiny shows that even as the Trump administration backs off its threats to fire Powell, the Fed is still subject to unusually sharp political pressures, despite being an independent agency.
The Federal Reserve is highlighting the importance of its political independence at a time when Donald Trump, who frequently attacked the Fed's policymaking in the past, edges closer to formally becoming the Republican nominee for president. On Friday, the Fed released its twice-yearly report on its interest-rate policies, a typically dry document that primarily includes its analysis of job growth, inflation, interest rates and other economic trends. This time, the Fed used the report to stress the vital need for the central bank to operate independent of political pressures.
Wells Fargo's profit for the fourth quarter came in ahead of Wall Street's targets but were about half of what it earned last year as the bank had to pay another $3.3 billion in fines and penalties to settle numerous scandals from recent years. Wells earned $2.9 billion, or 67 cents per share, in the the last quarter of 2022. Analysts were expecting a profit of 60 cents per share. Last year, the bank earned $5.8 billion in the fourth quarter, or $1.38 per share. Wells said the losses related to the regulatory matters were equal to about 70 cents per share.
