- Trump slammed Fed Chair Powell again, saying rates should be lower and hinting at possible removal.
- The White House is exploring legal grounds to fire Powell, though experts warn it could shake financial markets.
- Powell’s recent tariff warning frustrated Trump, fueling public tension between the Fed and the administration.
President Donald Trump didn’t hold back Friday afternoon when reporters asked about the Fed. His answer? Classic Trump.
“If we had a Fed Chair who actually knew what he was doing, interest rates would be coming down,” Trump said. “He should bring them down.” Simple as that, in Trump’s view.
This wasn’t just a one-off dig either. Lately, the White House has been turning up the heat on Jerome Powell, with top officials even hinting that firing him might be on the table. Which—by the way—is a legal gray area at best.
The Fed Feud Is Heating Up
White House economic adviser Kevin Hassett confirmed Friday that Trump’s team is actively exploring whether they can remove Powell from his position.
“The president and his team will continue to study that matter,” Hassett told reporters, when asked directly if firing Powell was now a real option. Powell, for his part, has repeatedly said he has no plans to step down and doesn’t believe he can legally be fired before his term ends in May 2026.
But Trump seems to be pushing the envelope. On Truth Social, he called Powell “Too Late”—one of his now-signature nicknames—and said, “Powell’s termination cannot come fast enough.” That… definitely raised some eyebrows.
Tensions Boil Over After Tariff Comments
What really seems to have poked the hornet’s nest this week is Powell’s reaction to Trump’s ongoing tariff war. Speaking in Chicago earlier, Powell said the tariff policies could drive up prices and create a mess for the Fed’s job of balancing inflation and employment.
“We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension,” Powell said. Basically, if inflation rises but growth slows, the Fed could be stuck between a rock and a hard place.
He added that the central bank is in “no rush” to move rates and wants more clarity before adjusting anything. Translation? No rate cuts just yet—something Trump is definitely not happy about.
What Happens If Trump Tries to Fire Powell?
Right now, the Fed’s benchmark interest rate sits between 4.25% and 4.5%. Futures markets are betting that the Fed won’t budge at next month’s meeting, with over 90% odds on a pause, according to CME’s FedWatch.
But Trump clearly wants a cut—and he wants it now. His public frustration has only grown louder. The question is, what happens if he actually tries to fire Powell?
Sen. Elizabeth Warren weighed in, warning that booting the Fed chair early could send financial markets into a spiral.
“If Chairman Powell can be fired by the president of the United States, it will crash markets in the United States,” Warren said on CNBC.
It’s unclear if Trump will really go for it, but if there’s one thing we know—he likes to keep people guessing
