WASHINGTON (AP) 鈥� President Donald Trump said Tuesday he has no plans to fire Federal Reserve Chair Jerome Powell, just days after his statement that he would like to terminate the head of the U.S. central bank caused a stock market selloff.
鈥淚 have no intention of firing him,鈥� Trump told reporters.
The U.S. president had previously insinuated otherwise as he said he could fire Powell if he wanted to, having been frustrated by the Fed putting a pause on cuts to short-term interest rates. Powell has said that Trump鈥檚 tariffs are creating uncertainty about slower growth and higher inflationary pressures, while the president maintains that inflationary worries are essentially non-existent.
The president maintains that energy and grocery prices are falling, so the Fed should cut its benchmark rates because inflation is no longer a threat to the U.S. economy, Trump said. His remarks indicated that he still plans to use the bully pulpit to pressure a U.S. central bank that is committed to resisting political pressure as part of its mandate to stabilize prices and maximize employment.
Trump's frustration led him to post on social media last Thursday: 鈥淧owell鈥檚 termination cannot come fast enough!鈥�
The Fed chair鈥檚 term ends in May 2026.
On Tuesday, Trump continued to air his grievances about Powell, even though he said the Fed chair would stay on the job despite the president's belief that inflation is no longer a problem.
鈥淚t鈥檚 all coming down,鈥� Trump said. 鈥淭he only thing that hasn鈥檛 come down, but hasn鈥檛 gone up much, are interest rates. And we think the Fed should lower the rate. We think that it鈥檚 a perfect time to lower the rate. And we鈥檇 like to see our chairman be early or on time, as opposed to late. Late鈥檚 not good.鈥�
Trump again attacked Powell on Monday on his Truth Social account, saying that 鈥渢here is virtually No Inflation.鈥�
The comment built on a statement by Trump last week that said he believed he could fire Powell, a move that shook financial markets and frightened investors that interest rates might be subject to politics instead of economic fundamentals.
鈥淚f I want him out, he鈥檒l be out of there real fast, believe me,鈥� Trump said in the Oval Office last Thursday. 鈥淚鈥檓 not happy with him.鈥�
The Fed has held off on further reductions to its federal funds rate, which influences the money supply by setting the interest rate that banks can charge each other for overnight loans. That rate is effectively 4.33%, down a fully percentage point since last August as inflationary pressures appeared to ease.
The Fed had initially raised that rate because of inflation spiking during Joe Biden鈥檚 presidency, a byproduct of the global economy recovering from the COVID-19 pandemic and higher energy and food prices after Russia invaded Ukraine in 2022.
But Powell has also been willing to challenge the president's trade policies. He said last week in a that Trump鈥檚 tariff policies would hurt the U.S. economy, a direct warning to a White House trying to sell the import taxes as a long-term positive for the country.
鈥淭he level of tariff increases announced so far is significantly larger than anticipated, and the same is likely to be true of the economic effects which will include higher inflation and slower growth,鈥� Powell said last week at the Economic Club of Chicago.
Josh Boak, The Associated Press
