Trump Pressures Powell: "Not a Good Fit, Term Should End Quickly"

U.S. President Donald Trump is urging Jerome Powell, Chairman of the Federal Reserve (Fed), the central bank of the United States, to lower interest rates, while pressuring him to resign, raising concerns about threats to independent monetary policy.

On the 17th (local time), during a summit with Italian Prime Minister Giorgia Meloni at the White House, President Trump responded to related questions from reporters by saying, "If I ask him to resign, he will step down."

President Trump stated, "I do not get along with him," adding, "I am letting him know that," and further said, "If I want his resignation, he will step down very quickly." He also revealed his thoughts, saying, "At some point, I think Chairman Powell will lower interest rates."

This is not the first time President Trump has targeted Chairman Powell. The day before, he posted on the social networking service (SNS) Truth Social, criticizing Powell's speech and stating, "Powell's term should end quickly."

In a speech at the Economic Club of Chicago in Illinois on the 15th, Chairman Powell said, "The level of tariff increases announced by the administration so far is much higher than expected," and "The impact on the economy is likely to be the same, including rising inflation and slowing growth."

Targeting this, President Trump said, "(The decision) is always late and wrong, and the Fed's Powell issued another typical messy report yesterday," claiming, "Oil and food prices (even eggs) are falling, and the U.S. is getting rich with tariffs."

He also pressured that Chairman Powell "should have lowered rates long ago like the European Central Bank (ECB)," and "he clearly needs to lower rates now."

The U.S. central bank chairman's term is set to allow independent decision-making on monetary policy, among other things. The Fed chairman, who concurrently serves as one of the Fed governors (14-year term), is appointed by the president and serves a 4-year term.

According to the Federal Reserve Act, which is the basis for the Fed's existence, Fed governors can only be removed for cause.

Chairman Powell has been serving as a Fed governor since 2012 during the Barack Obama administration and was appointed as Fed chairman during Trump's first term in 2018, and was reappointed by former President Joe Biden, currently serving his second term. Chairman Powell's term runs until May next year.

Nevertheless, as President Trump repeatedly makes remarks interpreted as pressure to resign by mentioning his term, controversy and concern are arising.

The Wall Street Journal (WSJ) reported that President Trump has been secretly discussing ways to remove Chairman Powell over the past few months and has not made a final decision on whether to oust him before his term expires. Some media outlets have also reported that former Fed governor Kevin Warsh is being considered as the next chairman.

U.S. legal experts agree that the president does not have the legal authority to remove the Fed chairman for policy disagreements, but there is no clear precedent from the U.S. Supreme Court, according to U.S. media. It is interpreted that President Trump, while publicly expressing distrust in Chairman Powell, mentioned voluntary resignation instead of dismissal, considering such legal controversy factors.

Chairman Powell has made it clear that he has no intention of resigning before his term expires, despite ongoing criticism from President Trump over interest rate cuts.

There is also an assessment that Trump's pressure did not create a significant movement in the market. On this day, the New York Stock Exchange was in a resting mood ahead of the 'Good Friday' holiday, with investors weary of tariff uncertainties. Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, said, "The market is in a stage of waiting and seeking direction," adding, "It is more important to see how the trade agreement will turn out now."

Kim So-yeon, Hankyung.com reporter sue123@hankyung.com