President Donald Trump slammed Federal Reserve Chair Jerome Powell on Thursday, reiterating his frustration that the Fed has not aggressively cut interest rates and saying that the central bank leader’s “termination cannot come fast enough.”
Trump hinted at moving to fire Powell, whose term does not expire until next year. The Republican president’s broadside comes a day after Powell said in a speech that Trump’s broad-based tariffs have left the Federal Reserve seeking “greater clarity” on the impact of policy changes in areas such as immigration, taxation, regulation and tariffs before making the move on interest rates.
“Oil prices are down, groceries (even eggs!) are down, and the USA is getting RICH ON TARIFFS,” Trump said in a social media post.
Referring to the European Central Bank, he added that Powell “should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough!”
The European Central Bank on Thursday lowered its key interest rate from 2.5% to 2.25%.
Powell was initially nominated by Trump in 2017, and he was appointed to another four-year term by President Joe Biden in 2022. At a November news conference, Powell indicated he would not step down if Trump asked him to resign.
He has also said that the removal or demotion of top Fed officials was “not permitted under the law.”
Powell started Trump’s second term in a relatively secure spot with a low unemployment rate and inflation progressing closer to the Fed’s 2% target, conditions that could have spared the U.S. central banker from the president’s vitriol.
But Trump’s aggressive and haphazard tariffs have increased the threat of a recession with both higher inflationary pressures and slower growth, a tough spot for Powell, whose mandate is to stabilize prices and maximize employment. With the economy weakening because of Trump’s choices, the president appears to be looking to pin the blame on Powell.
Powell, in his remarks at the Economic Club of Chicago on Wednesday, said the Fed will base its decisions solely on what is best for all Americans.
“That’s the only thing we’re ever going to do,” Powell said. “We’re never going to be influenced by any political pressure. People can say whatever they want. That’s fine, that’s not a problem. But we will do what we do strictly without consideration of political or any other extraneous factors.”
“Our independence is a matter of law,” Powell continued. “We’re not removable except for cause. We serve very long terms, seemingly endless terms. So we’re protected into law. Congress could change that law, but I don’t think there’s any danger of that. Fed independence has pretty broad support across both political parties and in both sides of the Hill.”
The Associated Press contributed to this report.