Donald Trump has signaled that he may soon fire Federal Reserve chair Jerome Powell, raising concerns about the independence of the US central bank. Following discussions with House Republicans, stock markets reacted negatively to Trump's potential actions. The president has persistently pushed for interest rate cuts to encourage economic growth, but Powell has resisted, citing inflation concerns stemming from Trump's tariff policies. Despite initial reports of a draft letter for Powell's dismissal, Trump later downplayed the chances of this occurring imminently, indicating no immediate plans to fire Powell, which helped stabilize the stock market post-announcement.
Donald Trump has privately indicated he is on the cusp of firing the Federal Reserve chair Jerome Powell, rattling Wall Street and renewing questions over the US central bank's independence.
Trump has repeatedly and publicly demanded the Fed cut interest rates to spur economic growth. Powell has so far declined, noting that Trump's controversial rollout of tariffs has clouded the outlook for inflation.
During a meeting with House Republicans, Trump openly mused about sacking Powell as Fed chair, which sent stocks sharply lower on Wednesday.
Despite speculation about an imminent firing, Trump stated, 'We're not planning on doing it,' which coincided with a slight recovery in the S&P 500.
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