Trump Not Intending to Replace Jerome Powell as Fed Chair

thecekodok


President-elect Donald Trump recently shared that he has no immediate plans to replace Federal Reserve (Fed) Chairman Jerome Powell when he takes office in January next year.


Despite their history of disagreements, Trump said in interviews that he does not expect to ask Powell to step down, although he believes Powell would go if explicitly told to.


Trump’s campaign has focused on lowering borrowing costs, which could lead to a clash with Powell over interest rate policy.


He has also sought to implement tariffs that could make the Federal Reserve’s job of managing inflation more challenging.


Powell, a Republican appointed by Trump in 2018, has previously said that his removal before his term ends in 2026 would not be allowed.


Their relationship soured during Trump’s first term as Powell’s decisions, such as raising interest rates, drew criticism from Trump, who wanted the value of the U.S. dollar to weaken.


Even at the start of the COVID-19 pandemic, Trump voiced his displeasure with Powell’s actions.


The tensions marked an end to the traditional practice of U.S. presidents who has avoided publicly criticizing the independent central bank.


However, investors now expect the Federal Reserve to cut interest rates soon, a decision that could signal a shift in focus for Powell's leadership.