Trump Demands Fed Board Remove Chair Jerome Powell, But Polymarket Traders Aren’t Buying It

Prediction markets show minimal belief that Donald Trump will attempt to remove Federal Reserve Chair Jerome Powell by the end of August, despite the former president’s latest attack on Powell via Truth Social.

What Happened: According to decentralized prediction platform Polymarket, the likelihood of Trump trying to fire Powell by August 31 stands at just 6% as of Thursday.

A separate Polymarket contract tracking the broader possibility of Powell being out as Fed Chair by the end of 2025 sits at 12%, down 11 percentage points from earlier levels.

These market odds come on the heels of Trump’s renewed public tirade against Powell, triggered by the Fed’s recent decision to hold interest rates steady. On Truth Social, Trump posted on Friday, “Jerome ‘Too Late’ Powell, a stubborn MORON, must substantially lower interest rates, NOW. IF HE CONTINUES TO REFUSE, THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!”

Trump has previously flirted with removing Powell during his presidency, with legal analysts and economists warning such action could shake market confidence in central bank independence.

Both attempts in 2018 and 2019 ultimately fizzled, but not before sending jitters through financial markets.

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Why It Matters: The current tensions stem from the Federal Reserve’s move this week to leave its benchmark interest rate unchanged, keeping it within the 4.25% to 4.5% range.

The central bank also signaled caution on future rate cuts, citing lingering inflation concerns.

Trump’s post implies potential intervention from the Fed’s Board of Governors, a legally ambiguous suggestion, as Powell cannot be removed solely for policy disagreements.

The Federal Reserve Act requires cause for dismissal, typically linked to misconduct or incapacity.

Despite Trump’s escalating rhetoric, bettors on Polymarket appear unmoved.

Market participants continue to assign low probabilities to any immediate change in Powell’s leadership, perhaps reflecting a belief in the Fed’s institutional stability or skepticism about Trump’s follow-through.

A niche contract tracking whether Powell ends up in jail by 2025 sits at just 3%.

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