Share and Follow
United States President Donald Trump launched a series of attacks against the country’s Federal Reserve chair Jerome Powell, accusing the central bank chief of “playing politics” by not cutting interest rates and asserting he had the power to evict Powell from his job “real fast”.
Powell’s termination as Fed chair “cannot come fast enough”, Trump said in comments posted to social media.
The post also said the Fed should cut interest rates and called a recent Powell speech about the economy a “complete mess”.
He expanded in a later press appearance that reflected how the Fed’s decisions could weigh on Trump’s fortunes.
Interest rates on home mortgages and other consumer credit remain high, for example, and the Fed is likely to offer little relief now that inflation risks are rising .
“The Fed really owes it to the American people to get interest rates down. That’s the only thing he’s good for,” Trump said.
“I am not happy with him. If I want him out of there, he’ll be out real fast, believe me.”
Trump’s pointed remarks about Powell echo the sometimes intense language used against the Fed chair in Trump’s first term. It pushes into an issue with the potential to rock global markets if Trump tries to fire Powell because he disagrees with his monetary policy decisions.
Kristalina Georgieva, managing director of the International Monetary Fund, said with the global outlook weakening in the face of the Trump tariff onslaught, central banks like the Fed needed to remain agile and credible — capacities that can be limited by political interference.
Krishna Guha, vice chair of investment banking firm Evercore ISI, said in a note: “A sudden crystallisation of the threat to Fed independence would both intensify market stress and shift it in more of a stagflationary direction with a sharp increase in tail risk.”
Trump’s comments come a day after Powell said at an event at the Economic Club of Chicago that the Fed’s “independence is very widely understood and supported in Washington and in Congress where it really matters,” drawing applause from the high-level group of business executives for a pledge to set interest rates independent of political pressure or partisan considerations.
In the same appearance, Powell downplayed the likelihood of interest rate cuts anytime soon.
He said the administration’s tariff plans were likely to raise both inflation and unemployment, leaving the Fed sidelined in making any changes to interest rates until the direction of the economy is clearer.
In the US, Trump’s plans have also led to a lower growth outlook, with economists polled by Reuters putting the odds of a recession at 45 per cent. But it has also raised the prospect of higher inflation policymakers said they may need to guard against by leaving interest rates at least at their current level.
The Fed’s benchmark interest rate is currently 4.25 per cent – 4.50 per cent, where it has been since December following several rate cuts late last year.
Powell also warned Trump’s tariff policies risked pushing inflation and employment further from the central bank’s goals, which it manages jointly under a mandate from Congress.
The Fed was “well positioned to wait for greater clarity” about Trump’s policies and their impact, he said.
 For the latest from SBS News, and .
