Powell’s 2% Inflation Ultimatum: The Fed Chair’s Final Mission Before Passing the Baton

Jerome Powell draws a line in the sand. The Federal Reserve Chair declares he won't step aside until inflation is firmly anchored back at the central bank's sacred 2% target. It's a promise that echoes through trading floors and Treasury markets—a personal stake in the final leg of the price stability marathon.

The Unfinished Business

Forget soft landings and dovish pivots. Powell's statement reframes the entire monetary policy narrative. It's not about when rates might ease; it's about crossing a specific finish line. The message cuts through the noise: the job isn't done until that 2% figure is more than a forecast—it's a reality. Markets, often accused of trading on hopium more than hard data, now have their timeline dictated by a single, stubborn metric.

A Legacy Defined by a Number

This transforms Powell's remaining tenure into a countdown. Every CPI print, every PCE report, becomes a direct report card for the Chair. It sidelines speculation about succession politics and puts the focus squarely on economic outcomes. The Fed's credibility, and arguably Powell's legacy, gets boiled down to achieving that one percentage point. Some on Wall Street might call that putting all your eggs in one basket—a risky move for someone overseeing the world's largest economy.

The Clock is Ticking

The declaration introduces a new kind of pressure. It creates a tangible, public benchmark for success or failure. There's no fudging it, no spinning 'progress.' Either inflation hits 2%, or Powell's final chapter gets written with an asterisk. It's a high-stakes gamble that bypasses vague forward guidance for brutal clarity. After all, in finance, a hard target is just a future miss waiting to happen for someone's algo.

Powell’s Remarks on His Legacy

The Federal Reserve’s latest FOMC meeting was intense, with Powell announcing a 25-bps rate. Soon after the announcement, the US dollar took a mild dip, with investors lessening their exposure towards risk assets. In that particular meeting, Powell shared a heartfelt note about his legacy, adding how he does not want to pass the torch to his successor unless inflation comes back to 2%. He further shared how he wants the US economy to attain its glory, with the labor market projecting a strong stance.

Powell on his legacy: I really want to turn this job over to whoever replaces me with the economy in really good shape… I want inflation to be under control, coming back down to 2%, and I want the labor market to be strong. That is what I want.

Powell had also shared his stance on rising inflation, stating how Trump’s tariffs are adding more pressure on the US economy.

Powell: If you get away from tariffs, inflation is in the low twos, so it is really tariffs that is causing most of the inflation overshoot.

The Next Fed Chair Appointment

According to Steven Hawke, a notable economic expert, the speculative regimens are hinting at Kevin Hassett as the next Fed chair.

WALL STREET HAS GIVEN A THUMBS DOWN ON KEVIN HASSETT AS THE NEXT FED CHAIRMAN.

According to @Polymarket, after peaking at 85% on Tuesday, the odds Pres. Trump will nominate the director of the National Economic Council, Kevin Hassett, as the next Fed chair have fallen to 75%. pic.twitter.com/BwAi8OQBaL

Hassett, in his recent interview, shared his insights about the US economic development, adding how he wants to fix what the Biden government could not repair when it comes to rising inflation.

KEVIN HASSETT: "Bottom line is that if you were just a typical family, your month’s groceries cost $400 when President Trump left office, and it cost almost $550 when Joe Biden left office. That extra $150 a month after paying also $14,000 more a year for your mortgage, it really… pic.twitter.com/thvlxguY8K