Trump's Stance on Fed Chair Remains Uncertain Amid Criticism

In the face of mounting criticism toward Jerome Powell, President Trump asserts he does not plan to fire the Federal Reserve chair. Discussions surrounding Powell's performance have intensified, but Trump downplays his earlier comments suggesting a possible dismissal.

In a recent statement, President Donald Trump declared it is "highly unlikely" he will dismiss Jerome Powell, chair of the US Federal Reserve, despite speculations that he raised the idea with lawmakers. On Tuesday, discussions about Powell's future sent stock markets and the dollar into a brief decline, but Trump's subsequent remarks suggested he is not pursuing the matter further.

Trump has consistently pressured Powell to decrease interest rates, voicing discontent through numerous criticisms, including calling him a "knucklehead" for what he deems poor management. Tensions escalated this week as GOP allies attributed the Fed chair's shortcomings to mismanagement of Fed properties.

Acknowledging past considerations about firing Powell, Trump claimed there are no immediate plans to act on this; however, he hinted that a dismissal could occur "unless he has to leave for fraud." As Powell's term is set to conclude in May of next year, he remains eligible to serve as a governor until 2028.

The Federal Reserve operates independently of the White House, as established by Congress, with Powell asserting that the president cannot remove him without valid cause. Meanwhile, Treasury Secretary Scott Bessent indicated that discussions are underway to identify potential replacements for Powell, including himself, Kevin Hassett, and Kevin Warsh, a conservative economist.

Appointed by Trump in 2017, Powell succeeded Barack Obama’s Janet Yellen, with former President Joe Biden extending his term in 2021.