Trump affirms no plans to dismiss Fed chair Powell, credits his administration for favorable economic aspects.
Rewritten Article:
In a recent sit-down with NBC's Kristen Welker, ex-president Donald Trump confirmed that Jerome Powell, the current Federal Reserve Chair, won't be replaced before his term ends in 2026. However, Trump didn't hold back his disdain for Powell, labeling him a "stiff" and calling for lower interest rates.
Trump's economy talk was a mix of boasts and blame-shifting. He maintained that his tariff-induced global trade upheaval would ultimately enrich Americans, while pinning the first-quarter US economic contraction on Joe Biden's administration. Trump reiterated his expectation for the Fed to reduce interest rates, expressing his belief that Powell, who he considered too chilly towards him, would ultimately comply.
When asked if he'd dismiss Powell before his term expires, Trump gave his most assertive denial, stating, "No, no, no. That was a total... Why would I do that? I get to replace the person in another short period of time."
Wall Street suffered a steep decline last month following Trump's intensified attacks against Powell, fueling concerns about the Fed's autonomy and market instability. Since then, Trump has toned down his rhetoric somewhat.
This latest statement marks the clearest indication yet that Trump intends to keep Powell on board, which should offer a measure of reassurance to markets unsettled by Trump's tariff onslaught.
On April 2, Trump slapped a 10% tariff on various nations, suspended tariff rate increases for 90 days for several trading partners, escalated tariffs on autos, steel, aluminum, imposed 25% tariffs on Canada and Mexico, and ratcheted up tariffs on China to 145%.
Trump's economic discourse presents a rollercoaster ride, dismissing economics concerns about a first-quarter GDP drop and claiming Biden is responsible for any economic faltering, but credits himself for any signs of improvement.
Trump's tariff maneuvers have instigated Wall Street's most volatile periods since the early COVID pandemic era. When asked when the economy will solely be his responsibility, Trump replied, "It partially is now. I really mean this. I think the good parts are the Trump economy and the bad parts are the Biden economy because he's done a terrible job."
He assigned kudos to his administration for driving down energy and gas prices and reversing the US trade deficit. Meanwhile, he dismissed concerns that China tariffs would hike consumer prices, stating Americans don't require large quantities of cheap products like dolls and pencils.
Trump's administration is in negotiations with over 15 countries over potential trade agreements that could ward off higher tariffs, with the first deal due to be announced soon. During the interview with NBC News, Trump refused to rule out making some tariffs permanent.
Trump acknowledged his tough stance towards China, indicating a suspended trade relationship, but China is eager to reach an agreement now.
Jerome Powell, appointed by Trump in 2018, came under fire for his allegedly stubborn stance, but has consistently defended the Fed's independence, stating that it operates free from political meddling. While his relationship with Trump has been stormy, Powell enjoys bipartisan support in Congress, a testament to the Fed's significance in maintaining economic stability without political influence.
During his tenure, Powell has taken decisive action during the pandemic, implementing expansive policies to shore up financial markets. His commitment to combating inflation has resulted in interest rate hikes, contributing to market volatility but also bolstering inflation expectations.
In all, Powell's leadership underscores the importance of monetary policy independence, which has sustained financial stability amid political pressures and economic challenges. The Fed's independence has enabled it to make decisions based on economic data rather than political considerations, which is key to ensuring investor confidence.
- Despite Trump's criticisms, Jerome Powell, the Federal Reserve Chair, will continue in his role until 2026, as confirmed by Trump in a recent interview with NBC.
- Trump, in the same interview, denounced Powell as a "stiff" and urged for lower interest rates, but later somewhat toned down his rhetoric against the Fed Chair.
- In 2026, Trump will have the opportunity to replace Powell, although he currently intends to keep him on board, which should provide reassurance to markets.
- Biden's administration has been blamed by Trump for the first-quarter economic contraction, while Trump credits his own administration for any economic improvements.
- Trump's tariff policies have instigated volatile periods on Wall Street, with a 10% tariff imposed on various nations and higher tariffs on goods such as autos, steel, aluminum, and negotiated with over 15 countries for potential trade agreements.
- The Fed's policy and legislation, unaffected by political meddling, have played a crucial role in maintaining economic stability, particularly during war-and-conflicts and general news events, as evidenced by Powell's leadership and the Fed's commitment to combating inflation.
