Support
Trump calls for Powell termination
President Donald Trump has reignited his public feud with Federal Reserve Chair Jerome Powell, calling him “too late and wrong” and demanding his termination.
Trump urges immediate dismissal of Fed Chair Powell, calling him “Too Late.”
Powell says Fed independence is “a matter of law” and protected from removal without cause.
The ECB cuts interest rates for the sixth time, now at 2.25%, citing weak growth and U.S. tariffs.
Markets weigh Fed independence amid growing White House influence over regulatory agencies.
Trump attacks Powell, again, and more aggressively
Donald Trump ramped up his long-standing criticism of Fed Chair Jerome Powell, posting Thursday on Truth Social that “Powell’s termination cannot come fast enough.” The president—who nominated Powell in 2017—accused him of being consistently “too late and wrong,” and blamed the Fed for not cutting interest rates in 2024 despite easing inflation and falling oil prices.
While it remains unclear whether Trump intends to legally challenge Powell’s role, the rhetoric comes as Trump and his allies test the legal limits of presidential authority over independent agencies. Powell’s term as chair ends in May 2026, while his term as a Fed governor runs through 2028.
Legal tensions over Fed independence intensify
The question of whether the president can remove Powell gained fresh relevance after Trump’s administration fired top officials at independent agencies like the FTC and NLRB. Powell acknowledged on Wednesday that the Supreme Court is currently reviewing cases involving agency leadership removal.
“We’re watching the case carefully,” Powell said, though he expressed doubt it would apply to the Fed. He also reiterated that the Fed’s independence is grounded in law: “There’s no removal except for cause.”
Treasury Secretary Scott Bessent confirmed that the White House will likely consider Powell’s replacement “sometime in the fall,” and called central bank independence “a jewel box that must be preserved.”
ECB cuts rates amid Trump pressure and trade uncertainty
The European Central Bank cut its deposit rate by 25 basis points to 2.25%, its sixth straight cut since June 2024. ECB officials cited subdued inflation, fragile growth, and ongoing trade uncertainty driven by U.S. tariffs as key reasons for the easing cycle.
Trump pointed to the ECB's continued easing as proof that Powell is lagging. “Look at Europe,” Trump wrote. “They’re cutting and we’re standing still while Powell issues another MESS of a report.”
Trump's inflation message vs. Powell’s caution
Trump also claimed that grocery and oil prices are down and the U.S. is “getting rich” on tariffs. While crude prices have fallen over 10% this year, food inflation has persisted, with grocery prices up 3% year-on-year.
Powell, in contrast, warned in his Chicago speech that tariffs could pose a long-term inflation risk if not managed carefully. “Our obligation is to ensure that short-term price increases don’t become entrenched,” he said.
