Trump Says He May Change His Mind about Firing Fed Chair Powell

Reuters

11:49 JST, June 21, 2025

WASHINGTON, June 20 (Reuters) – U.S. President Donald Trump on Friday again floated the idea of firing Jerome Powell, the Federal Reserve chair he has long attacked over interest rates he wants lowered.

“I don’t know why the Board doesn’t override (Powell),” Trump wrote in a lengthy post on Truth Social criticizing Fed policy. “Maybe, just maybe, I’ll have to change my mind about firing him? But regardless, his Term ends shortly.”

Trump added: “I fully understand that my strong criticism of him makes it more difficult for him to do what he should be doing, lowering Rates, but I’ve tried it all different ways.”

Fed chairs have long been seen as insulated from presidential dismissal for reasons other than malfeasance or misconduct, but Trump has threatened to test that legal premise with frequent threats to fire Powell.

Trump nearly as frequently reverses course on those threats. “I’m not going to fire him,” he said at the White House on June 12.

The Fed held rates steady on Wednesday in the 4.25%-4.50% range and forecast slower growth as well as higher unemployment and inflation by year’s end.

Fed Governor Chris Waller, who has been floated as a possible Trump pick to be Powell’s successor, said on Friday that with inflation coming down and the labor market showing signs of weakening, rate cuts should be considered as soon as July.

But even Waller joined Wednesday’s unanimous Fed decision to leave rates on hold, signaling no inclination by any of Powell’s six fellow Board members, or of the five voting regional Fed bank presidents, to “override” him. Fed decisions are typically reached through consensus, and more than a couple of dissents would be rare.

Elected partly on voters’ belief that he could contain high inflation, the Republican U.S. president has imposed tariff hikes in office. Powell, echoing an academic consensus, has said some of those tariff hikes will be paid for in higher consumer prices.

Powell’s term ends in May 2026, and Trump is expected to nominate a successor in the coming months.

A Supreme Court ruling in May eased concerns that Trump could fire Powell as the justices called the Fed “a uniquely structured, quasi-private entity.”