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Amidst ongoing vote counts, initial maneuvers concerning the future of the Federal Reserve have already begun. Fed chairman Jerome Powell firmly stated in a press conference on Thursday that he would not step down, even at the behest of President-elect Donald Trump, emphasizing that it would be unlawful for the president to oust or demote a Fed governor.

This stance comes against the backdrop of public statements from Trump and his campaign advisers over recent months signaling an intention to compromise the Fed’s political independence. Trump previously expressed that he should have input on interest rate decisions, reflecting dissatisfaction with Powell’s earlier actions to raise rates soon after Trump appointed him as chair.

On Thursday, the Federal Reserve implemented a quarter percentage point cut in interest rates, with another similar reduction anticipated in December. However, Powell provided minimal insight regarding the trajectory of interest rates in the near future, including how Trump’s policies might influence monetary policy decisions.

Further complicating the situation is the Fed's lack of control over long-term interest rates. Even if Trump appoints Fed leadership aligned with his desire for lower borrowing costs, the bond markets could still drive long-term borrowing expenses higher.

Despite these complexities, Trump seems positioned to significantly influence the Fed, with numerous governor positions set to open during his term and a strong Republican Senate majority likely to support his nominations over the next two years.

Powell’s resolve to complete his term sets the stage for potential further confrontations with Trump, who has historically disregarded the norm of presidential non-interference with Federal Reserve policies.