Trump Urges Immediate Resignation of Federal Reserve Chair Powell

The former president's call for Powell's resignation highlights ongoing friction regarding interest rate policies, with Trump linking his demands to past tariff actions impacting economic growth and raising questions about presidential authority over Federal Reserve appointments.

In a notable escalation of tensions, former President Donald Trump has called for Jerome Powell, the Federal Reserve chair, to resign immediately. Trump’s demand was delivered through a post on his Truth Social platform, where he stated, "'Too Late' should resign immediately!!!" His remarks came alongside a link to an article addressing calls for an investigation into Powell's testimony regarding renovations at the Fed's Washington headquarters.

Originally nominated by Trump during his first term, Powell has faced continual criticism from the former president, particularly for his reluctance to cut interest rates. The legality of Trump's demand for Powell's resignation remains uncertain, as the president traditionally lacks the power to remove a Fed chair without cause.

Despite earlier affirmations this year that he had “no intention of firing” Powell, Trump is now advocating for rate reductions to stimulate economic growth. Powell's response indicated that the Fed would have already considered rate cuts if not for Trump's contentious tariff policies, which have sparked debate about their impact on U.S. fiscal stability.

When approaching the meeting of central bankers in Portugal, Powell confirmed that the administration's plan to substantially raise tariffs influenced the Fed's decision-making process regarding interest rates. The Federal Reserve chose not to comment on Trump's recent statements when approached by the BBC.

In a recent twist, Bill Pulte, director of the Federal Housing Finance Agency and past critic of Powell, has called for a congressional investigation into Powell's alleged political biases and misleading testimonies, suggesting these may warrant his removal "for cause." Additionally, Powell has characterized allegations surrounding the Fed's renovation costs as "misleading and inaccurate."

As Trump's second term progresses, questions remain regarding his aggressive approach to independent regulatory bodies, with historical precedents showing that board members of such agencies can only be dismissed for specific legal reasons. This situation underscores the evolving dynamics between the White House and the independent Federal Reserve as politics intersects with economic policy.