Trump Calls for Powell’s Termination Over Fed Policy Amid Tariff Concerns

Former President Donald Trump is once again clashing with Federal Reserve Chair Jerome Powell this time demanding his removal.

Trump, on Thursday, called for Powell’s “termination” after criticizing the central bank for not cutting interest rates fast enough. His comments came just one day after Powell warned of economic risks stemming from Trump’s own sweeping tariffs.

In a fiery early morning post, Trump claimed the Federal Reserve is falling behind global peers. He pointed to the European Central Bank, which cut rates for the seventh time in a year.

“Jerome Powell of the Fed, who is always TOO LATE AND WRONG… his termination cannot come fast enough!” Trump wrote.

Fed’s stark warning on Trump’s tariffs

Powell warned Wednesday that Trump’s tariff policies are “significantly larger than anticipated” and unlike anything in modern U.S. history. He said these policies may push the U.S. toward stagflation, a dangerous mix of rising prices and slowing growth.

Other Fed officials have echoed those concerns. Many say Trump’s tariffs are already raising inflation and joblessness. Billionaire investor Ray Dalio recently warned the U.S. could already be in, or near, a recession.

Powell, originally appointed by Trump in 2018 and reappointed by President Biden in 2021, serves until May 2026.

History of conflict between Trump and Powell

Tensions between Trump and Powell date back years. In 2018, Powell began raising interest rates over inflation fears. Trump responded by calling him “the enemy” and later claimed he had the “right to remove” Powell.

In March 2020, Trump lashed out after markets plunged during the pandemic. But he later praised Powell for cutting rates to zero and avoiding collapse.

Recently, Trump told Bloomberg he wouldn’t reappoint Powell but would let him finish his current term “if he’s doing the right thing.”

Can Trump remove Powell? It’s complicated

Powell has stated that a Fed chair cannot legally be removed by the president. The Federal Reserve is an independent agency by design. Still, Trump’s actions in other agencies have raised questions.

Trump previously removed two Democratic commissioners from the Federal Trade Commission. He claimed their policy differences were incompatible with his administration’s goals. He also fired Democratic members of the National Labor Relations Board and Merit Systems Protection Board who are now suing to get their jobs back.

The legality of removing independent agency heads could soon face a Supreme Court test.

Chief Justice John Roberts has asked both sides to submit briefs on a key precedent: the 1935 Humphrey’s Executor case. That ruling limited presidential power to fire agency leaders. Trump’s administration has said the case should be overturned.

What’s next?

The latest clash puts Powell, and the Fed’s independence under renewed scrutiny. With Trump leading in polls ahead of the next election, the stakes are high. A Supreme Court ruling could reshape how much control a president has over U.S. economic policy.

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