Donald Trump ramps up the pressure on Jerome Powell as Fed chair stands firm on rates

Washington D.C.: President Donald Trump escalated his attacks on Federal Reserve Chair Jerome Powell this week, calling for his "termination" after Powell signaled the central bank would not rush to cut interest rates — a move Trump has long demanded.

Trump’s latest outburst came after Powell warned that the former president’s proposed tariffs could create a "challenging" scenario for the economy by slowing growth while pushing prices higher. The Fed has kept interest rates elevated since 2022 to combat inflation, resisting Trump’s pressure to lower borrowing costs. In a Truth Social post, Trump declared, "Powell’s termination cannot come fast enough!"

Though Trump appointed Powell in 2018, he has repeatedly clashed with him over monetary policy. Lower rates could stimulate the economy, potentially aiding Trump politically, but risk reigniting inflation. Powell, however, has refused to yield, emphasizing the Fed’s independence. Legal experts argue firing Powell would be unprecedented; the Fed chair has stated he would not resign if pressured, and the law protects his position from political interference.

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The conflict could end up in the Supreme Court, which is reviewing a case on presidential authority over independent agencies. While Powell doubts the ruling will directly affect the Fed, the outcome could reshape central bank autonomy. Meanwhile, the Fed faces a delicate balancing act: keeping rates high enough to curb inflation without stifling jobs.

Trump insists the Fed is "TOO LATE" to cut rates, citing recent dips in inflation and Europe’s rate reductions. However, economists warn that Trump’s tariffs may reverse progress by raising consumer prices.