President Donald Trump is once again criticizing Federal Reserve Chair Jerome Powell, demanding his immediate resignation over interest rate policy disagreements.
Trump Amplifies Resignation Demands
Trump expressed frustration over Powell not lowering interest rates, which he argues leads to increased debt-servicing costs and worsens the economic situation. The conflict escalated after Powell suggested that Trump's tariffs contribute to inflation, complicating the justification for rate cuts.
Legal Obstacles to Removal
Despite Trump's threats to remove Powell, experts point out significant legal hurdles. The Supreme Court has reaffirmed the Federal Reserve's independence, and forcibly removing the chair before the end of his term could face major legal challenges.
Market Reaction to Trump-Powell Conflict
The conflict between Trump and Powell is impacting financial markets. For example, Bitcoin prices jumped 2.62% to over $108,000 amidst the political tensions, reflecting the market's sensitivity to uncertainties in Fed policy.
The conflict between Trump and Powell highlights the complex relationship between politics and economics. While Trump's demands for Powell's resignation may be more declarative, the potential consequences for financial markets could be significant.
