16.07.2025 18:28
President Donald Trump vehemently denied any immediate plans to dismiss Federal Reserve Chairman Jerome Powell on Wednesday. This follows reports of a Tuesday night meeting with congressional Republicans where the possibility of Powell's removal was reportedly discussed, fueling weeks of tension surrounding the Fed's independence. The President's months-long criticism of Powell's interest rate policies added considerable weight to the situation.
According to initial reports from the *New York Times*, during a meeting focused on crypto legislation, Trump displayed a draft letter outlining Powell's dismissal. Subsequent confirmation from Reuters revealed Trump had also informally polled congressional Republicans present, receiving apparent support for the action. However, this speculation was swiftly quashed by Trump himself, who publicly declared his intention not to fire Powell, unless serious misconduct, like fraud, were to arise. While acknowledging the possibility, he stated such a move was highly improbable.
Powell's refusal to lower interest rates has been a recurring source of friction between himself and the President for an extended period. Recently, however, Trump's focus shifted towards reported budget overruns of $700 million for Federal Reserve headquarters renovations. Despite prior assurances against dismissing Powell, comments from National Economic Council Director Kevin Hassett last Sunday suggested the President's administration was actively exploring the option. Adding another layer of intrigue, Treasury Secretary Scott Bessent revealed the commencement of a formal process to identify a successor for Powell, whose term extends until May 2026. The Federal Reserve Board of Governors chose not to provide an official statement on the matter.
The President's authority to remove the Fed chair, while technically possible given the presidential appointment process, is heavily constrained by the central bank's operational independence. The considerable implications of such an action, along with the lack of historical precedent, make the situation highly complex and warrant continued observation. This is a developing situation, and further updates will follow.
