Amid persistent Federal Reserve delays in interest rate cuts, President Trump's antagonism toward Chair Jerome Powell has intensified dramatically. Despite previous assurances against termination, Trump now openly desires Powell's resignation.
Late Wednesday, Trump explicitly stated his wish for Powell to step down while acknowledging market concerns: "I'd welcome his resignation—it's his choice. Market turmoil would follow if I dismissed him." This marks a stark reversal from his prior position.
Simultaneously, Trump renewed criticism over the Fed's headquarters renovation, ballooning from $1.9 billion to $2.5 billion. He previously suggested this cost could justify Powell's removal. The renovation, approved in 2017 and commenced in 2021, now faces heightened political scrutiny.
A Fed spokesperson countered, emphasizing Powell's firm stance: "He won't resign voluntarily or if pressured." Powell maintains presidential removal lacks legal grounding, vowing to serve until his term concludes next May. However, White House economic advisor Kevin Hassett contends Trump possesses authority to dismiss the Fed chair with valid cause.
Trump earlier dismissed circulating reports about imminent dismissal preparations, calling Powell "terrible at his job" while denying active plans. Yet he confirmed discussing personnel shifts with lawmakers, hinting at changes within eight months. "Termination remains unlikely barring proven fraud," Trump conceded.
Wall Street's financial titans responded forcefully: - Bank of America CEO Brian Moynihan declared the Fed "inherently independent," stressing successors must address interest rates while shielded from political interference. - Goldman Sachs chief David Solomon labeled central bank independence "critically important," urging global defense of this principle. - Citigroup CEO Jane Fraser linked Fed credibility directly to independence, calling it "essential for market efficacy and U.S. competitiveness." - JPMorgan's Jamie Dimon delivered a stark warning: "Undermining Fed independence backfires spectacularly, achieving the opposite of intended outcomes."
These coordinated statements underscore Wall Street's mounting alarm over potential political encroachment on monetary policy autonomy.
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