(Axios) - President Trump blasted Federal Reserve chair Jerome Powell on Thursday with the strongest suggestion yet of his intention to try to fire the nation's most powerful economic policymaker.
Why it matters: Trump's attack comes after Powell said that tariffs were likely to stoke inflation and slow economic growth.
What they're saying: "Powell's termination cannot come fast enough!," Trump posted on Truth Social.
Reality check: The Fed is an apolitical institution. It makes monetary policy decisions without political considerations, with protection from political retribution.
- The legal precedent, Humphrey's Executor v. United States, protects commissioners at independent agencies, like the Fed, from being fired at will.
- The Supreme Court is about to hear a case that could determine the fate of such protection.
Threat level: If the court overturns the precedent, there would be huge implications for global financial markets.
- Much of what makes the U.S. the safest place to invest is the trust that the Fed acts in the best interest of the American economy — not the president.
State of play: "I don't think that that decision will apply to the Fed, but I don't know. It's a situation that we're monitoring carefully," Powell said during an interview at the Economic Club of Chicago yesterday, referring to the Supreme Court case.
- "Generally speaking, Fed independence is very widely understood and supported in Washington — in Congress, where it really matters," Powell added.
What to watch: In a speech yesterday, Powell said that Trump's tariffs had been "significantly larger than anticipated."
- "Tariffs are highly likely to generate at least a temporary rise in inflation," Powell said, warning of the possibility that inflationary effects could also stick around.
- "The same is likely to be true of the economic effects, which will include higher inflation and slower growth," he added.
The Fed has kept interest rates on hold, citing uncertainty around White House policy. Powell reaffirmed that outlook yesterday, drawing attacks from Trump that echo criticisms from his first term in office.
- "The ECB is expected to cut interest rates for the 7th time, and yet, "Too Late" Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete "mess!" Oil prices are down, groceries (even eggs!) are down, and the USA is getting RICH ON TARIFFS. Too Late should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now," Trump posted on Truth Social, referring to the European Central Bank's expected rate cut later on Thursday.
Flashback: In a news conference in November, Powell was asked whether he would step down if Trump asked him to resign. Powell gave an unusually blunt answer: "No."
- He later said that the removal or demotion of top Fed officials was "not permitted under the law."
- Powell's term as Fed chair ends in May 2026. He was initially nominated by President Trump in 2017, and appointed to another four-year term by Biden in 2022.
By Courtenay Brown
April 17, 2025
