President Trump signals Jerome Powell’s days at the Federal Reserve are numbered as he unleashes a blistering critique of the Fed Chair’s reluctance to lower interest rates amid market turbulence.
Quick Takes
- Trump blasted Powell for being “too late” to cut interest rates compared to the European Central Bank
- The President directly linked the stock market decline to Powell’s policies, declaring “termination cannot come fast enough”
- Powell, nominated by Trump in 2017 and renominated by Biden in 2021, has a term ending in May 2026
- The Fed Chair has repeatedly defended the central bank’s independence from political pressure
- Powell suggested Trump’s tariff policies could lead to inflation and job losses, further fueling the President’s ire
Trump Unleashes on Powell as Markets Tumble
President Donald Trump has intensified his criticism of Federal Reserve Chairman Jerome Powell, publicly declaring that Powell’s “termination cannot come fast enough” after the Fed’s hesitation to reduce interest rates. The President’s comments came as financial markets experienced volatility, which Trump directly attributed to Powell’s monetary policy decisions. Trump specifically highlighted that while the European Central Bank had already moved to cut rates, Powell remained stagnant, describing the Fed Chair’s recent economic report as a “complete mess” that has contributed to the downturn in stock values.
The conflict between the President and the Fed Chair he once appointed has escalated as economic indicators have shown mixed signals. Trump’s frustration stems from his belief that lower interest rates would stimulate economic growth and boost market performance. The timing of Trump’s criticism is notable as it comes during a period when many analysts have suggested the economy might benefit from monetary easing to counteract inflationary pressures and prevent a potential recession.
Why is the #US stock market falling?
While Trump’s #tariffs are the biggest and most immediate trigger for the sharp selloff in the US stock market, several other key factors also appear to have contributed to the downtrend on Wall Street.
1. Trade war jitters:
Trump's… pic.twitter.com/vPJmWjfQDG
— Markets Today (@marketsday) April 5, 2025
Powell Defends Fed Independence Amid Presidential Pressure
Despite the President’s public criticism, Powell has remained steadfast in defending the Federal Reserve’s independence. Powell, who was originally nominated by Trump in 2017 and later renominated by President Biden in 2021, has a term that extends until May 2026. This timeline creates a potential conflict as Trump returns to the White House with economic policy as a centerpiece of his agenda. The Fed Chair has consistently maintained that central bank decisions should be made without political influence, emphasizing instead the importance of data-driven analysis.
“Generally speaking, Fed independence is very widely understood and supported in Washington, in Congress, where it really matters,” said Powell.
Powell has specifically pushed back against Trump’s monetary policy preferences by suggesting that the President’s tariffs could actually worsen the economic situation. According to Powell, higher tariffs might lead to inflation and job losses, potentially offsetting any benefit from lower interest rates. This economic assessment directly contradicts Trump’s trade strategy and has further inflamed tensions between the administration and the Federal Reserve leadership.
Constitutional Questions and Presidential Authority
The confrontation raises important constitutional questions about presidential authority over the Federal Reserve. While Trump has previously threatened to fire Powell during his first term, the Fed Chair has stated that the President lacks the legal authority to remove him from his position. The Federal Reserve was designed as an independent institution specifically to shield monetary policy from short-term political pressures. This institutional independence has historically been respected by administrations of both parties as essential to economic stability.
“We’re never going to be influenced by any political pressure. People can say whatever they want. That’s fine with — that’s not a problem, but we will do what we do strictly without consideration of political or any other extraneous factors,” Powell said.
Market analysts are closely watching the developing tension between Trump and Powell, as uncertainty about Fed leadership could itself become a factor in economic volatility. The President’s history of criticizing Powell stretches back to his first term, when he frequently expressed disappointment with interest rate decisions. Now, with Trump back in the White House, the renewed conflict signals potential turbulence ahead for both monetary policy and the relationship between the executive branch and the Federal Reserve.
