Trump’s Stance on Fed Chair Jerome Powell No Plans to Dismiss Him

President Donald Trump clarified on Tuesday that he had no plans to dismiss Fed Chair Jerome Powell, despite ongoing dissatisfaction with the central bank’s rate reduction approach. In response to media speculation, Trump firmly stated, “Never did. The media distorts things. No, I have no intention of firing him.”

Trump’s Criticism of Powell Intensifies

The president’s comments followed public frustrations voiced last week, including a tweet on Truth Social calling for Powell’s immediate termination. Trump’s frustration centered on Powell’s reluctance to cut interest rates quickly enough, asserting, “We believe it’s the perfect time to reduce the rate and would like to see our chairman act promptly, rather than delay.”

White House Denies Plans for Powell’s Removal

Kevin Hassett, Director of Trump’s National Economic Council, had suggested on Friday that the president was considering Powell’s removal, citing the president’s increasing discontent with the Fed’s policies. However, Trump emphasized that he had no intention of making a change in leadership at the central bank.

Trump Launches Strategic Middle East Tour to Secure Investments

Donald Trump Middle East tour with confirmed visits to Saudi Arabia, the United Arab Emirates, and Qatar…

Global Interest Rates Diverge as ECB Cuts Benchmark Rate

Trump criticized Powell’s slow rate cuts, especially as the European Central Bank reduced its rate to 2.25%. Trump expressed concerns that the Fed’s 4.25-4.5% rate range harmed the economy. Global institutions acted more quickly.

Stability in Markets Amidst Trade Deal Progress

Despite the heated comments from the president, markets showed stability on Tuesday, with the dollar and Treasuries maintaining relative calm. The White House also reported progress in trade negotiations, which helped alleviate some concerns over tariffs imposed earlier this month.

Fed’s Focus on Inflation Amid Economic Growth

The Federal Reserve has maintained steady interest rates this year after reducing them by a full percentage point in late 2024. While the U.S. economy grew by 2.8% last year, economists now anticipate that tariffs could contribute to a slowdown in 2025. Fed officials remain cautious, focusing on inflation concerns despite a strong economic expansion.

Fed’s Long-Term Strategy Amid Economic Pressure

Trump has advocated for aggressive rate cuts, but most Fed officials believe current policies are essential to address persistent inflation. With inflation above 2% for the last four years, Powell and colleagues are cautious about changes that could worsen inflation, especially amid ongoing tariffs.