Donald Trump tore into Federal Reserve Chairman Jerome Powell Thursday morning, criticizing his leadership and calling for his removal after Powell voiced concern about the inflationary impact of tariffs in a speech the day before.
Background: Speaking at the Economic Club of Chicago, Powell indirectly pushed back on Trump’s trade policies, warning that tariffs were “likely to move us further away from our goals,” and could lead to more persistent inflation if not managed properly.
- “The inflationary effects could also be more persistent,” Powell said, emphasizing that keeping long-term inflation expectations anchored would be key.
Trump Tweet: On Truth Social, Trump blasted Powell’s leadership, mocking him as “‘Too Late’ Jerome Powell” and calling the Fed’s latest report “another, and typical, complete ‘mess!’”
- “Oil and grocery prices are down,” Trump claimed, adding, “the USA was getting RICH ON TARIFFS.”
- He concluded: “Powell’s termination cannot come fast enough!”
Fed Put: When asked if there was a “Fed Put” — the idea that the Fed would rescue markets if they fall too far — Powell said “no, but with explanation.”
- “Markets are struggling with a lot of uncertainty… But having said that, markets are functioning… just about as you would expect them to function.”
Bottom Line: This seemed inevitable. When Trump won the election in November, people wondered if Trump was going to fire Powell right away. However, Trump has refrained from attacking Powell until yesterday.