() A senior White House official told that President Donald Trump is likely to fire Federal Reserve Chair Jerome Powell soon.
Trump denied reports on Wednesday, telling reporters he was unlikely to fire Powell anytime soon despite having repeatedly clashed with the Fed chair over interest rates.
“I don’t rule out anything, but I think it’s highly unlikely, unless he has to leave for fraud,” Trump said when asked if he’s ruling out firing Powell.
However, a senior White House Official told that Trump asked lawmakers how they felt about firing Powell and they expressed approval for the action.
There have been reports that Trump has already drafted a letter, but a Senior White House official told President Trump has not drafted a letter to fire Federal Reserve Chairman Jerome Powell.
It is not clear if Trump has the legal authority to fire Powell, with federal law stating that the chair can only be removed for cause. Whether disagreement about monetary policy counts as cause has not been tested in the courts.
The Trump administration has pressured Powell publicly, recently accusing the Fed of mismanaging a construction project on its headquarters.
Traditionally, the Fed has operated independently of the White House when it comes to setting interest rates. But Trump has pushed for Powell to act at his behest and cut interest rates to spur economic growth.
Cutting rates, which remain close to a two-decade high, could also cause inflation to spike. Powell has kept rates steady following hikes in 2022 and 2023, indicating he wants to move cautiously as inflation slows.
Powell has also expressed concern that Trump’s tariffs could cause inflation to worsen. After a pause in April, Trump has resumed his policy of instituting “reciprocal” tariffs, sending letters to several countries announcing new tariff rates to go into effect Aug. 1.
