President Donald Trump doubled down on his repeated efforts to force “incompetent” Federal Reserve Chair Jerome Powell to resign, the Wall Street Journal reported.
The president explained in an April 15 Fox Business Television interview that he’ll fire Powell if he doesn’t resign by a new May 15 deadline. “Well, then I’ll have to fire him, OK?” President Trump said.
The president also signaled that he would not drop the Department of Justice criminal probe of Powell for unsubstantiated allegations of lying to Congress over the costs of the $2.5 billion restoration of Fed headquarters.
“I’ve held back firing him. I’ve wanted to fire him, but I hate to be controversial, you know?” the president said, adding that the unprecedented criminal probe was a way to prove Powell’s “incompetence” as a leader.
The latest round of the controversy could delay Senate confirmation of former Fed Governor Kevin Warsh as Trump’s nominee to succeed Powell as Fed chief, Reuters noted.
That’s because Federal Reserve officials are protected by a law that limits the reasons they can be removed from their jobs.
The Supreme Court is now considering that law as it prepares to rule this spring on another case stemming from the president’s attempt to fire Fed Governor Lisa Cook on unsubstantiated allegations of mortgage fraud, the Wall Street Journal reported.
Powell and Fed allies and advocates have said Trump’s efforts are pretext attempts to force the central bank to drastically lower interest rates.
A Fed spokesperson declined to comment to TheStreet April 15.
DOJ prosecutors rebuffed in surprise visit to Fed headquarters
Three DOJ employees, including two prosecutors, attempted to tour the construction site surrounding the Marriner S. Eccles Federal Reserve Board Building in a surprise visit on April 14, The Wall Street Journal first reported.
Robert Hur, an outside attorney for the Fed, objected to the visit in a letter to Attorney General Jeanine Pirro’s office.
Hur’s letter referred to a federal judge’s decision last month to throw out a pair of subpoenas issued to the central bank, the Wall Street Journal noted. Hur said this is because the investigation appeared to “harass and pressure” Powell to bend to Trump’s demands to lower interest rates or step down as the central bank’s leader.
President Trump has escalated his threats to fire Fed Chair Jerome Powell for allegedly lying to Congress over the costs of reconstruction work at the Federal Reserve building.
Getty Images
Powell, Warsh, the FOMC leadership and what it could mean
Powell’s term as head of the Federal Open Market Committee, the central bank’s policymaking panel, expires May 15.
His term as a Fed Governor continues through 2028. Past Fed Chairs have stepped down from the bank after their FOMC terms ended.
If Warsh’s confirmation by the full Senate is delayed, Powell said last month he would continue to serve as FOMC head pro tempore, which has happened to past chairs.
He also said he would not leave the Fed Board of Governors until the legal proceedings are completely dropped.
Related: Ex-top Fed official drops shocking message on independence
Warsh’s long-delayed nomination hearing has been scheduled for 10 a.m. April 21 before the powerful Senate Banking Committee.
Warsh’s financial disclosures, released April 14, showed that he would be the richest Fed chair in history.
His has been a complicated confirmation process amid mounting concerns about the Fed’s ability to operate independently, as mandated by Congress.
GOP’s Tillis vows to block Warsh nomination process
The unprecedented criminal probe of a sitting Federal Reserve chair has prompted one Republican member of the Senate Banking Committee, outgoing North Carolina Sen. Thom Tillis, to vow to delay Warsh’s nomination process until the Powell investigation is shut down permanently.
Senate Banking Committee Chairman Tim Scott (R-S.C.) told Fox Business April 14 that he expected the Tillis situation to be resolved in the near future, clearing the way for Warsh’s nomination to reach the full Senate for approval. Scott did not divulge additional details.
Trump shrugged off Tillis’ approach.
“He’s on his way out…and I think he doesn’t want the legacy of stopping a great person who could be great…I know he said what he said, and maybe it’s true, in which case I’ll have to live with it,” the president said.
Future of Fed independence crucial to economists, Wall Street, politicians
Warsh, once known for his hawkish views on monetary policy when he was a Fed governor, can expect a slew of questions (and some pretty harsh ones from both parties) during his confirmation hearing next week.
From economists to traders to lawmakers, the primary reaction to Trump’s actions to influence the Fed is not about interest-rate cuts.
It’s about institutional risk.
- Economists are concerned about market and credibility damage.
- Traders are concerned about political interference skewing markets.
- Politicians are concerned about constitutional and governance disputes.
The common thread in this ever-changing narrative is less of a monetary policy dispute and more of a test of whether the world’s largest central bank can remain independent from direct executive control.
President Trump repeats demands for lower interest rates
The president, throughout his second administration, has blasted Powell for not slashing interest rates to 1% or lower over the last 14 months.
He attacked Powell as a “moron” and lobbed other personal and professional insults (such as “Too Late” Powell).
More Federal Reserve:
The federal funds rate is currently 3.50% to 3.75% after the Federal Open Market Committee held the rate steady after the last two meetings.
As I reported, it made three quarter-point cuts to the funds rate in its last meetings of 2025.
The next FOMC meeting is April 29.
CME Group’s FedWatch Tool estimates a near 100% probability the panel will vote to continue to hold rates steady.
The president repeated his demand for lower interest rates in the television interview.
Related: Fed Chair nominee discloses stunning vast wealth in court filings