Trump Threatens to Fire Powell if Fed Chair Stays Past Mandate
U.S. President Donald Trump renewed pressure on Federal Reserve Chair Jerome Powell on Wednesday, threatening to fire the central bank chief if he remains in the role beyond the end of his mandate, as the leadership transition is complicated by an ongoing Justice Department investigation tied to Fed renovation cost overruns.
Powell’s term as Fed chair is set to expire on May 15, 2026. He could remain on the Fed’s Board of Governors through 2028 under his separate governor term, and could potentially stay in a leadership capacity if a successor has not been confirmed. Powell said last month he would not step down from his position as a Fed governor until the Justice Department probe involving him is “well and truly over, with transparency and finality.”
Speaking to Fox Business, Trump said he would have to fire Powell if he “is not leaving on time,” adding that he has wanted to fire him. Trump has repeatedly criticized Powell over the past year for not cutting interest rates more aggressively.
The administration’s pressure campaign has extended beyond rhetoric. It has initiated an investigation into Powell over renovation cost overruns at the central bank and has sought to remove another Fed governor, Lisa Cook. Asked whether he would drop the DOJ probe involving Powell, Trump said: “I’m not playing. I have to find out.”
Trump has named former central banker Kevin Warsh as his pick to succeed Powell, but Warsh must be confirmed by the U.S. Senate. Warsh is scheduled to face a confirmation hearing before the Senate Banking Committee next Tuesday, but the nomination faces resistance from lawmakers who argue the DOJ probe amounts to political pressure on an independent central bank.
Senator Thom Tillis, a Republican member of the Senate Banking Committee, has vowed to hold up Warsh’s nomination as long as the investigation remains unresolved. Treasury Secretary Scott Bessent told reporters on Wednesday that Republicans on the committee “are aligned” in viewing Warsh as a strong candidate, adding that he is optimistic Warsh will be confirmed in time. Bessent said earlier he hoped Warsh could take office on May 16.
White House economic adviser Kevin Hassett said the standoff would be resolved, expressing confidence on the sidelines of the IMF and World Bank spring meetings in Washington. Brookings Institution senior fellow David Wessel questioned the rationale for prolonging the investigation if it delays Warsh’s confirmation, arguing that easing the DOJ pressure could clear the path for Powell’s departure and the Senate process.
Powell first became Fed chair in 2018 during Trump’s first term and was reappointed in 2022 under then-President Joe Biden. For markets, the episode adds a fresh layer of institutional uncertainty, with attention likely to remain on the status of the DOJ investigation, Warsh’s Senate hearing, and whether the leadership handover can be completed smoothly ahead of the May 15 deadline.
Source : Newsmaker.id
