Janet Yellen’s tenure as the chair of the Federal Reserve Board of Governors is now officially over.
On Monday, Jerome Powell took the oath of office and was sworn in as the next Fed chair.
President Donald Trump officially announced Powell as his Fed chair nominee on Nov. 2, 2017. The first talks of Trump's preference for Powell began to emerge in October.
Until that point, there were several names reportedly being considered as options to lead the Fed, including Yellen. But Trump chose Powell, who was already serving as a Fed governor, to replace Yellen as the Fed chair.
Last month, Powell cleared the last hurdle in the nomination process when the Senate confirmed him as chair by an 85-12 margin.
Powell became a Fed governor on May 25, 2012 to fill an unexpired term. In June 2014, Powell was reappointed to the board and sworn in for a term ending Jan. 31, 2028. Powell’s term as Fed chair will last four years.
After Trump announced his preference for Powell, Yellen announced that she planned to step down from the Fed Board of Governors, even though her term was set to last until Jan. 21, 2024.
In Yellen’s last act as chair, the Fed announced late Friday that it will be restricting the growth of Wells Fargo until it “sufficiently improves its governance and controls.”
In announcing the enforcement action, the Fed said that Wells Fargo’s compliance breakdowns and widespread consumer abuses were the primary drivers of the action.
“We cannot tolerate pervasive and persistent misconduct at any bank and the consumers harmed by Wells Fargo expect that robust and comprehensive reforms will be put in place to make certain that the abuses do not occur again,” Yellen said in a statement. “The enforcement action we are taking today will ensure that Wells Fargo will not expand until it is able to do so safely and with the protections needed to manage all of its risks and protect its customers.”
Upon taking office, Powell issued a statement, saying that the Fed will “remain vigilant” during his tenure.
“As I begin my term, I want to stress my commitment to explaining what we’re doing and why we are doing it. Congress has assigned the Federal Reserve several important jobs,” Powell said in a statement.
“We are tasked with achieving stable prices and maximum employment. We also supervise financial institutions, including our largest banks. We play a key role in ensuring the stability of our financial system, and the integrity of our payment system,” Powell continued.
Powell also noted that “unemployment is low, the economy is growing, and inflation is low.”
Powell said that the Fed’s decisions on monetary policy will support “continued economic growth, a healthy job market, and price stability.”
Powell also touted the strength of the financial system when compared to what it was before the financial crisis, adding that the Fed plans to “keep it that way.”
Powell said that the Fed is prepared to deal with the changing risk factors that will impact the economy.
“We will also work hard to make sure that our regulation and supervision are efficient as well as effective,” Powell concluded. “At the Federal Reserve, we know that our decisions matter for American households and businesses. Our long-standing, non-partisan tradition is to make decisions objectively, based only on the best available evidence.”
