Paul Volcker, a former chairman of the Federal Reserve, has called on Congress to avoid divesting the Fed of its regulatory powers.

Volcker told lawmakers on Thursday that if lawmakers succeeded in their desire to limit the Fed's scope to monetary policy would hinder both rate-setting and the supervision of the American banking system.

"Enforcing a separation of monetary policy and supervisory policy would not serve either function well," he said. "The Federal Reserve Board should not become an