United States President Donald Trump has once again called for Federal Reserve Chair Jerome Powell to step down, marking the latest in a series of attacks that have raised concerns about the independence of the US central bank.
Trump made the call for Powell to “resign immediately” on Wednesday, following his administration’s top housing regulator’s urging for Congress to launch an investigation into the central banker.
The director of the Federal Housing Finance Agency, Bill Pulte, accused Powell of “political bias” and “deceptive testimony” regarding renovations at the Federal Reserve headquarters in Washington, DC. In response to Pulte’s comments, Trump said “Too Late” – a nickname used to criticize Powell for not lowering interest rates faster – should resign.
Trump’s demand comes days after he sent Powell a letter demanding the central banker lower the benchmark interest rate by “a lot”, currently set at a range of 4.25 percent to 4.5 percent.
Trump has repeatedly criticized Powell for not backing faster rate cuts, arguing the central banker’s cautious stance is holding back economic growth and concerns about inflation are overblown. However, rate cuts can increase inflation, which central banks typically aim to keep low.
Trump’s sweeping tariffs are expected to put upward pressure on prices. In response to Trump’s demands, Powell stated the central bank has taken a wait-and-see approach to rate cuts to gauge the impact of Trump’s tariffs.
“We didn’t overreact. In fact, we didn’t react at all; we’re simply taking some time,” Powell said, explaining the Fed’s decision to hold off on rate cuts. Trump has repeatedly demanded Powell step down or be removed since coming into office in January, despite the US president’s limited authority to fire the Fed chair “for cause”, meaning specific misconduct, not policy decisions.
The US Supreme Court reaffirmed precedent limiting the president’s ability to remove the top central banker in a ruling that singled out the Federal Reserve as having a distinct status compared with other independent agencies. Trump mentioned he has “two or three” choices in mind to succeed Powell without elaborating on who is under consideration.