President Donald Trump has escalated his public criticism of Federal Reserve Chair Jerome Powell, demanding Powell’s dismissal following the Fed leader’s warnings that Trump’s trade policies could destabilize the U.S. economy. This clash underscores the ongoing tension between the White House and the traditionally independent central bank.
In a post on his Truth Social platform early Thursday, Trump labeled Powell as “TOO LATE AND WRONG,” accusing the Fed of failing to act decisively in lowering interest rates. “Powell’s termination cannot come fast enough!” the president declared, renewing his push to exert greater presidential influence over the Federal Reserve.
Powell, appointed by Trump in 2018 and reappointed by President Joe Biden in 2021, has consistently maintained the Fed’s autonomy amid political pressures. On Wednesday, noted CNN, he cautioned that a resurgence of broad tariffs—likely under a second Trump administration—could lead the country into stagflation, a problematic combination of high inflation and stagnant economic growth.
The Fed chairman said Trump has brought “very fundamental policy changes,” including his sweeping tariffs that are “significantly larger than anticipated.”
Powell’s comments align with warnings from other Federal Reserve officials and economic experts, who argue that renewed protectionism could drive up costs for consumers while curbing job creation. Notably, billionaire investor Ray Dalio recently warned that the U.S. may already be approaching a recession, driven by persistent inflation.
Trump’s antagonism toward Powell isn’t new. In 2019, he sharply criticized the Fed’s decision to raise interest rates, going so far as to call Powell “an enemy.” In 2020, Trump suggested he had the authority to remove the Fed Chair, though he later praised Powell’s swift action in cutting rates during the COVID-19 market downturn.
In a more recent interview with Bloomberg, Trump stated he would not consider Powell for a third term but might allow him to complete his current one—set to expire in May 2026—if he felt Powell was aligning with his economic vision.
The chairman has stood firm, asserting that his tenure is protected by law. “The law is clear,” he stated in 2019. “I fully intend to serve out my term.”
That legal protection, however, could soon face scrutiny. The Supreme Court may revisit the landmark 1935 case Humphrey’s Executor v. United States, which restricts a president’s ability to remove heads of independent federal agencies for political reasons. The ruling stemmed from President Franklin D. Roosevelt’s attempt to dismiss a Federal Trade Commission member due to policy disputes—a move the Court rejected.
Recent legal challenges—including Trump’s dismissal of Democratic FTC members—have reignited debates about the president’s power to remove agency officials. In February, Trump’s legal team petitioned the Supreme Court to overturn Humphrey’s Executor, a move that could pave the way for future presidents to dismiss central bank leaders like Powell.
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