President Donald Trump, speaking from the Oval Office on Thursday beside Italian Prime Minister Giorgia Meloni, said clearly that he could fire Federal Reserve Chair Jerome Powell any time he wants.
“If I want him out, he’ll be out of there real fast, believe me,” Trump said. He followed that up by saying, “I’m not happy with him.” Trump’s statement comes as the president ramps up pressure on Powell to cut short-term interest rates.
This new threat followed a post on his social media site Truth, where he said, “Powell’s termination cannot come fast enough!” Trump’s complaints have focused on the Fed’s refusal to lower interest rates, even though inflation is cooling.
He blames Powell for keeping rates high, accusing him of “playing politics.” The Federal Reserve hasn’t budged despite the White House’s pressure campaign. Powell hasn’t responded directly, but his stance hasn’t changed either.
Trump made the comments the same week the Supreme Court is reviewing a case that could give presidents more power to fire leaders of independent agencies.
Powell currently cannot be removed unless there is cause, something protected by federal law. “Our independence is a matter of law,” Powell said. “We’re not removable except for cause. We serve very long terms, seemingly endless terms.”
Powell warns tariffs complicate the Fed’s job
Trump and his economic advisers have said they want longer-term interest rates to drop. That would make it cheaper for Americans to borrow for things like homes, cars, and appliances. But Powell doesn’t directly control those rates. He manages the short-term federal funds rate. Trump’s new tariffs caused long-term borrowing costs to rise, putting pressure on households and businesses.
Powell has warned that the tariffs would raise inflation and slow growth. That’s the opposite of what Trump wants. And because of that, the Fed might not be able to cut rates anytime soon. Powell has made it clear that even if the economy slows, the central bank’s focus will stay on reducing inflation. He’s not changing course because of White House complaints.
Elizabeth Warren, the Massachusetts senator and top Democrat on the Senate Banking Committee, said Thursday that if Trump were allowed to fire Powell, it would shake up U.S. markets.
Speaking from the New York Stock Exchange, she said, “If Chairman Powell can be fired by the president of the United States, it will crash markets in the United States.” The Senator also said, “I have tangled with Powell on a regular basis about both regulations and interest rates.”
Warren added that the strength of the U.S. stock market comes from the belief that big decisions aren’t made for political reasons.
“The infrastructure upholding the stock market — and therefore the global economy — is the idea that the big pieces move independent of the politics.”
Warren warned that if economic decisions were left up to the president’s “magic wand,” the U.S. would be no different “from any other two-bit dictatorship around the world.”
Powell was nominated by Trump back in 2017, but Joe Biden reappointed him in 2022 to another four-year term. That term runs until May 2026.
Source: Cryptopolitan / Digpu NewsTex