Trump calls for Federal Reserve to pull control from Jerome Powell
Fed. Chair Powell: ‘rates remain steady’
Federal Reserve Chairman Jerome Powell held a news conference following a Federal Open Market Committee (FOMC) meeting in Washington, DC. Federal Reserve officials left interest rates unchanged.
President Donald Trump on Friday called for the Federal Reserve’s board of governors to strip Fed Chair Jerome Powell of his power.
On his Truth Social platform, Trump once again criticized Powell for not lowering interest rates at the board of governors meeting this week, calling him “stubborn.” Trump has been verbally attacking Powell for months.
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What did Trump say about Jerome Powell?
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What they’re saying:
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Trump said if Powell doesn’t “substantially” lower rates, “THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!”
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President Donald Trump delivers remarks alongside Sen. Tim Scott (R-SC) (L) and Federal Reserve Chair Jerome Powell, as they tour the Federal Reserve’s $2.5 billion headquarters renovation project on July 24, 2025 in Washington, DC. The Trump adminis –> <!–>
Trump sees the rate cuts as leading to stronger growth and lower debt servicing costs for the federal government and homebuyers. The president argues there is virtually no inflation, even though the Fed’s preferred measure is running at an annual rate of 2.6%, slightly higher than the Fed’s 2% target.
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The other side:
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Fed officials — and nearly all economists — believe a solid economy means rates should be relatively high, to prevent overheating and a burst of inflation.
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The Fed has the responsibility of stabilizing prices and maximizing employment. Powell has held its benchmark rate for overnight loans constant this year, saying that Fed officials needed to see what impact Trump’s massive tariffs had on inflation.
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By the numbers:
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Trump has called for slashing the Fed’s benchmark rate by 3 percentage points, bringing it down dramatically from its current average of 4.33%. The risk is that a rate cut that large could cause more money to come into the economy than can be absorbed, possibly causing inflation to accelerate.
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Friday’s jobs report showed a rapidly decelerating economy, as just 73,000 jobs were added in July and downward revisions brought down the June and May totals to 19,000 and 14,000, respectively.
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Why does Trump want Powell to resign?
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The backstory:
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Trump has been calling for Powell’s resignation since taking office for a second term in January, repeatedly criticizing Powell for not lowering interest rates and saying he’s done a “terrible job.” More recently, Trump began accusing Powell of mismanaging the U.S. central bank’s $2.5 billion renovation project.
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RELATED: Trump ‘not planning’ to fire Fed Chair Jerome Powell, despite reports
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Trump has said he has the power to fire Powell if he chooses to, but later clarified that he doesn’t intend to do it.
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Powell has resisted and made clear that the Fed’s independence is “a matter of law.” The Supreme Court recently signaled that Trump can’t fire Powell simply because the president disagrees with him on interest rates. But legally he could do so “for cause,” such as misconduct or dereliction of duty.
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Timeline:
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Powell’s term ends in May 2026.
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The Source: This report includes information from The Associated Press, President Trump’s Truth Social account and previous LiveNow from FOX reporting.