Fed chair Powell won't resign if Trump asks
Add Axios as your preferred source to
see more of our stories on Google.
Photo Illustration: Brendan Lynch/Axios. Photo: Brendan Smialowski/Getty Images
Federal Reserve chair Jerome Powell told reporters on Thursday he will not resign before the end of his term, even if President-elect Trump asks him to leave.
Why it matters: Powell's intention to serve out the rest of his term sets up a new battle between the central bank and Trump, who disregarded long-time norms that presidents do not talk about Fed policy.
The context: Powell's comments came in response to a question at a press conference, held after the Fed cut interest rates for the second time this year.
What they're saying: When asked whether he would step down if President-elect Trump asked him to resign, Powell gave an unusually blunt answer: "No."
- He later said that the removal or demotion of top Fed officials was "not permitted under the law."
- Powell also said election results play no role in policy decision-making.
The big picture: Trump publicly criticized Powell during his first stint at the White House, at one point suggesting he might be a bigger enemy than China's Xi Jinping.
- The former president first appointed Powell to lead the Fed in 2017. But Trump soured on him for raising interest rates. He considered the legality of firing Powell before deciding against it.
What to watch: The Fed is a politically independent institution. It makes decisions on how to manage the economy without considering what any president might want.
- Trump's reelection might threaten that independence. He told Bloomberg earlier this year that he would let Powell serve out the rest of his term, "especially if I thought he was doing the right thing."
- A Trump adviser recently suggested that the administration could appoint a "shadow" Fed chair that, in practice, would undermine Powell.
