Federal Reserve Chairman Jerome Powell stated on Thursday that he would not step down if asked by President-elect Donald Trump.
When asked directly whether he would resign if Trump made the request, Powell responded simply: “No.”
During a press conference following the Fed’s decision to cut interest rates by a quarter percentage point, Powell emphasized that the president does not possess the authority to fire or demote him. “Not permitted under the law,” he stated.
Trump, who appointed Powell as Fed chair in 2017, frequently criticized him during his presidency, claiming Powell was not acting quickly enough to ease monetary policy.
In an October interview, Trump argued that while he shouldn’t have the authority to dictate interest rate decisions, he believes he should have a voice in them. “I don’t think I should be allowed to order it, but I think I have the right to put in comments as to whether the interest rates should go up or down,” Trump told Bloomberg News at the Chicago Economic Club on October 15.
On Thursday, Powell also stated that Trump’s recent election victory would not immediately influence the central bank’s policy. “In the near term, the election will have no effects on our policy decisions,” he said.
With Republicans securing a Senate majority and potentially gaining control of the House of Representatives, Trump’s path to passing his economic policies may be smoother.
Steve Mnuchin, Trump’s former Treasury Secretary, suggested that the president-elect’s focus will likely include tax cuts and tariffs, particularly targeting China. Powell acknowledged that the new administration’s policies could have economic implications that might impact the Fed’s dual mandate of maximum employment and price stability, though he emphasized it was too early to predict any changes. “We are not making any assumptions,” Powell concluded.
