Trump threatens Powell’s job at Fed over interest rate policy
New York Times columnist Andrew Ross Sorkin and Federal Reserve Chairman Jerome Powell speak during the New York Times annual DealBook summit at Jazz at Lincoln Center in New York City, U.S, on Dec. 04, 2024. (AFP Photo)
U.S. President Donald Trump intensified his criticism of Federal Reserve Chair Jerome Powell on Thursday, claiming he has the authority to remove the central bank chief while demanding immediate interest rate cuts.
“He’ll leave if I ask him to, he’ll be out of there,” Trump told reporters. “I’m not happy with him. I let him know it and if I want him out, he’ll be out of there real fast, believe me.”
The president later escalated his rhetoric in a post on his Truth Social platform, writing that “Powell’s termination cannot come fast enough” and criticizing the Fed chair’s monetary policy decisions as “always TOO LATE AND WRONG.”
Trump’s comments came the same day the European Central Bank lowered its benchmark deposit rate by a quarter point, a move Trump referenced when urging Powell to follow suit. “Too Late should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now,” Trump wrote.
ECB President Christine Lagarde expressed support for Powell following Trump’s remarks, saying she had “a lot of respect for my friend and esteemed colleague.”
The Federal Reserve has maintained its benchmark interest rate at 4.25% to 4.5% since the beginning of 2025, adopting what analysts describe as a cautious approach amid complex economic conditions.
Powell criticizes Trump tariff policies
Powell warned Wednesday that Trump’s proposed widespread tariffs could force the Fed into a difficult position of choosing between addressing inflation and unemployment. The president’s fluctuating tariff proposals have created uncertainty among investors and governments worldwide about U.S. trade strategy.
While presidents have historically clashed with Fed chairs, removing Powell would be unprecedented in modern American governance. The president does not possess direct authority to fire Federal Reserve governors, though Trump could initiate a lengthy process to attempt removal by proving “cause.”
“An independent Fed is vital for a healthy economy — something that Trump has proved is not a priority for him,” Senate Majority Leader Chuck Schumer said on X in response to Trump’s criticism.
Powell, who was originally nominated by Trump during his first term, has insisted he will complete his current term, which ends next year. “I fully intend to serve all of my term,” Powell said at an April 4 event in Virginia, where he also indicated the Fed was not rushing to reduce rates.
Financial markets currently predict approximately a two-thirds probability that the Fed will maintain current interest rates at its upcoming May meeting, according to CME Group data.
Recent economic indicators show U.S. year-on-year consumer inflation slowed to 2.4% in March, approaching the Fed’s target of 2%, aided by a 6.3% decline in gasoline prices.
