U.S. President Donald Trump has renewed his criticism of Federal Reserve Chair Jerome Powell, calling for his removal and blaming the central bank’s leadership for delaying interest rate cuts. Trump’s comments, made both online and in the Oval Office, follow Powell’s recent warnings about the economic risks posed by Trump’s tariff policies. Speaking at a public event in Chicago, Powell cautioned that the administration’s new trade measures represent a significant shift in U.S. policy.
He highlighted that these tariffs are far-reaching and historically uncommon, putting the central bank in uncharted territory. Despite political pressure, Powell emphasized that the Federal Reserve remains committed to basing its monetary policy decisions on economic data, in line with its mandate to maintain employment and price stability. Trump responded harshly, accusing Fed Chair Powell of consistently lagging behind global central banks, particularly the European Central Bank, which recently announced another interest rate cut.
Trump described Powell’s latest report as chaotic and declared that his termination “cannot come fast enough.” The Federal Reserve did not issue a response to the remarks. Powell, first appointed by Trump in 2018 and reappointed by President Joe Biden in 2022, has maintained that his position is protected by law and that he intends to complete his term, which ends in 2026. Trump, however, has repeatedly claimed he could remove Powell at will, despite longstanding legal precedent limiting presidential authority over independent federal agencies.
Following a private meeting with the heads of several major U.S. retailers, including Walmart, Target, and Home Depot, Trump appeared to soften his position. The CEOs reportedly voiced serious concerns about potential disruptions to the supply chain and broader economic consequences stemming from both the tariff policy and uncertainty over the Fed’s leadership. Markets responded positively to Trump’s apparent shift, with U.S. stock indexes rising after he publicly stated he had no plans to dismiss Powell.
The Dow Jones Industrial Average gained over 400 points, while the S&P 500 and Nasdaq also posted strong performances. Treasury Secretary Scott Bessent, a key economic advisor, has urged caution, reinforcing the importance of preserving the Federal Reserve’s independence. He helped coordinate the meeting between Trump and the retail executives and has become a central figure in efforts to steer the administration away from decisions that could destabilize financial markets.
While Trump has scaled back his threats against Powell, his earlier statements have reignited legal and political discussions about the limits of presidential power over independent agencies. A 1935 Supreme Court ruling established that presidents cannot arbitrarily dismiss officials from such bodies, though recent actions by Trump to remove members of other regulatory boards have raised new concerns about institutional autonomy. – By MENA Newswire News Desk.