On Friday, White House National Economic Council chair Kevin Hassett said the Donald Trump administration is exploring ways to remove Federal Reserve Chairman Jerome Powell.
What Happened: Hassett told reporters at the White House that the “President and his team will continue to study,” whether it’s possible to fire Powell, reported The Hill.
The legal framework surrounding Powell’s position complicates any potential firing. According to a 90-year-old Supreme Court precedent, a Federal Reserve chair can only be removed for misconduct or severe neglect of office.
Powell has repeatedly stated that he cannot be legally removed from office and has insisted he would serve his full term.
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Why It’s Important: Hassett’s comments followed a series of public attacks from President Trump, who has been increasingly critical of Powell, particularly over the Fed’s refusal to cut interest rates.
Trump’s anger toward Powell intensified this week, culminating in a Thursday morning post on social media where the president expressed his frustration, saying he couldn’t wait for Powell’s “termination.”
This followed Powell’s warnings that Trump’s trade tariffs could fuel inflation and cause a slowdown in economic growth, a scenario Trump has said would prevent the Fed from making the necessary rate cuts.
The potential dismissal of Powell has raised concerns about the stability of U.S. financial markets. Investment strategists have warned that such a move could undermine the independence of the Federal Reserve and cause significant market turbulence.
Sen. Elizabeth Warren (D-Mass.) has also cautioned that firing Powell could lead to a stock market collapse.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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