On Wednesday, former President Donald Trump reiterated his call for Jerome Powell, the Chair of the Federal Reserve, to resign immediately.
Trump nominated Powell during his first term in office, and President Joe Biden later appointed him for a second term. Powell’s current term is set to conclude in May 2026.
Last Tuesday, Trump mentioned that he had two or three preferred candidates in mind to replace Powell.
The former president has criticized the Federal Reserve for failing in its duties, emphasizing that interest rates should be at 1% or lower.
Trump strongly condemned the Fed’s decision to keep interest rates unchanged, arguing for rate cuts, claiming that the central bank keeps borrowing costs high for the U.S. government.
In response, Jerome Powell indicated that he likely would have lowered interest rates this year if it weren’t for Trump’s tariffs. He pointed out that it takes time to see the effects of tariffs, advising a cautious approach to adjustments.
During a discussion with officials from other central banks at a meeting in Portugal this week, Powell stated, “We actually ceased rate cuts when we recognized the scale of the tariffs and their impact. All inflation expectations in the U.S. rose significantly because of those tariffs, but we didn’t overreact or take any action.”
He added, “We’re just taking some time to observe, and as long as the U.S. economy remains strong, we believe it’s prudent to wait and see what these effects might be. So far, they haven’t manifested significantly, and for now, we are in a holding pattern.”