Treasury Secretary Scott Bessent privately urged President Donald Trump not to fire Federal Reserve Chairman Jerome Powell this past week, according to a report. Bessent reportedly warned that such a move would destabilize markets, hinder potential rate cuts, and trigger legal backlash.
Trump, frustrated by the Fed’s refusal to cut interest rates, has called Powell one of his “worst appointments” and blamed him for weakening the housing market. The president also criticized the Federal Reserve Board for not stopping Powell’s actions.
The Federal Reserve Act allows removal of the Fed chair only “for cause.” A potential opening may come as Office of Management and Budget Director Russ Vought recently accused Powell of “gross mismanagement” over $2.5 billion in Fed building renovations—$700 million above initial projections.
Powell defended the costs and requested a review by the Fed’s inspector general. Though Trump has not followed through on removal, scrutiny of Powell’s leadership continues to escalate.
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