President Trump took aim at Federal Reserve Chair Jerome Powell on Thursday, writing in a social media post that Powell should be cutting interest rates and adding that his “termination cannot come fast enough.”
Mr. Trump’s comments on his social media app, Truth Social, comes after Powell delivered a speech on Wednesday that warned of the potential consequences of the Trump administration’s trade war, while reiterating that the central bank plans to hold interest rates steady for now.
The Fed has put the brakes on interest rate cuts this year due to sticky inflation, which has remained higher than its target growth rate of 2% per year.
In the meantime, Mr. Trump has introduced a series of tariffs on major trading partners that economists say could reignite inflation. Powell highlighted those risks on Wednesday in saying that the Trump administration tariffs could create a “challenging scenario” for the U.S. that requires both managing both accelerating inflation and a slowing economy.
Those types of conditions describe “stagflation,” a mashup of “stagnation” and “inflation” that describes periods when economic growth falters while price hikes accelerate.
In his social media post, Mr. Trump on Thursday pointed to the European Central Bank, which cut rates by 0.25 percentage points after the president posted his message.
“The ECB is expected to cut interest rates for the 7th time, and yet, ‘Too Late”‘Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete ‘mess!’,” Trump wrote.
He added, “Oil prices are down, groceries (even eggs!) are down, and the USA is getting RICH ON TARIFFS. Too Late should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough!”
Can Mr. Trump fire Powell?
After Mr. Trump was elected in November, Powell said he wouldn’t step down if asked by the president, who has previously criticized his performance. Powell has also noted that, under the law, presidents may not fire or demote the Fed chair.
Trump nominated Powell to lead the Fed in 2017, and Powell was re-nominated by President Joe Biden in November 2021. Powell’s term as Fed chair ends May 15, 2026.
Over the years, Powell has steadfastly defended the central bank’s independence. In December, he said that insulating the Fed from political influence is “for the benefit of all Americans,” allowing it to make decisions based on economic data rather than at the behest of elected officials.
