In brief
President Trump has issued a warning to Federal Reserve Chair Jerome Powell, threatening to dismiss him if he does not resign by the end of his term in May. The conflict arises from Powell's resistance to cut interest rates, which Trump has advocated for. Powell's term expires on 15 May, and he plans to remain until his successor, Kevin Warsh, is confirmed. This confrontation further complicates the relationship between Trump and Powell, with the backdrop of a federal investigation into Powell's management of the Federal Reserve's renovations.
US President Donald Trump has threatened to fire Federal Reserve Chair Jerome Powell if he does not step aside at the end of his term in May. The two have been embroiled in a bitter spat over Powell's reluctance to cut the central bank's interest rate, despite Trump's repeated calls. Powell's term expires on 15 May, but he is planning to remain in post until his successor, Kevin Warsh, is confirmed by the Senate.Then I'll have to fire him, Trump told Fox Business, when asked about Powell's plans to stay on in the job. I've held back firing him. I've wanted to fire him, but I hate to be controversial, he added.Thom Tillis, an influential Republican senator on the committee overseeing nominations for the Federal Reserve, has threatened to block Warsh's confirmation unless a criminal investigation into Powell, linked to the renovation of the Federal Reserve building, is dropped. Powell stated, That's what the law calls for. That's what we've done on several occasions.Senate Majority Leader John Thune has voiced his belief that the Department of Justice should conclude its probe into Powell quickly, stating, I think it's in everybody's best interest to wrap up the investigation.Another Republican senator, Mike Rounds, remarked that the investigation does not serve the purpose of helping the president secure his preferred Federal Reserve Chairman. Trump expressed hope that Tillis would drop his opposition, saying, he knows what to do.Despite Trump's insistence on continuing the investigation into Powell, he remains optimistic about Warsh's confirmation before Powell's term ends. Trump's earlier criticisms of Powell included concerns over excessive costs associated with Federal Reserve renovations, which he claimed could have been managed for significantly less. Historically, if Trump follows through with his threat to dismiss Powell, it would break a long-standing precedent as no Federal Reserve Chair has ever been fired.
