Powell Says Will Not Quit As Fed Chair Even If Trump Asks
Powell maintains his commitment to serving out his term as Federal Reserve Chair, despite previous criticism from President-elect Trump. His current tenure ends in May 2026.
Federal Reserve Chairman Jerome Powell was asked will he step down if President-elect Donald Trump tells him to resign. His one word response: "No".
Powell addressed a press conference after the US central bank delivered a second consecutive interest rate cut.
Trump has been a vocal critic of Powell during his 2017-2021 presidency. He complained about the central bank not cutting interest rates as he wished, while the administration was delivering massive corporate and income tax cuts to stimulate US economic growth.
Notably, the Fed chair was appointed by Trump himself, to succeed Janet Yellen. President Joe Biden retained Powell in 2021, and his current term ends in May 2026.
Trump will be sworn in as the new US president on Jan. 20., after his stunning election victory over Kamala Harris. CNN reported on Thursday he will likely allow Powell to continue to serve the remainder of his term.
While Trump could change his mind, he and his economic team's present view is that Powell should remain atop the central bank until Powell's term expires in May 2026, CNN reported, citing the unidentified senior adviser.
Powell said it is "not permitted under the law" for the president to remove the Fed chair. He then declined to answer a question about any concerns about a president encroaching on the Fed’s political independence.
In a separate response, Powell said in the near term, the US election outcome "will have no effect" on Fed decisions. "We don’t know what the timing or substance of economic policy changes going forward," he said, adding the central bank isn’t going to guess or assume what’s going to happen.
Trump has pledged to cut corporate taxes while raising tariffs on all imports into the country, the former seen as charging economic growth and the latter inflationary.
"The plan is not to have stagflation. Anything you do with interest rates hurts either growth or prices," Powell said, on likely stagflation scenario.
