⚖️ Trump Reignites Powell Debate: Fresh Political and Market Turmoil – July 17, 2025
1. Trump Revisits Powell Dismissal Idea
In recent remarks, President Donald Trump, now re-elected, reignited speculation about removing Federal Reserve Chairman Jerome Powell. This came despite earlier statements suggesting it was "very unlikely."
FT News Briefing reported renewed internal White House discussions about Powell’s dismissal, raising alarm among economists and lawmakers.
Meanwhile, Reuters noted that while markets briefly wobbled, they recovered after Trump clarified he had “no immediate plans” to fire Powell.
2. Market Reactions
Asian and European stocks showed modest gains, but initial volatility followed Trump’s comments.
Gold prices surged, then fell as the dollar strengthened after Trump downplayed the dismissal scenario.
These movements reflect heightened investor sensitivity to political interference in monetary policy.
3. Political Pushback
Prominent Republicans, including Senator Thom Tillis, warned that firing Powell would be a “grave mistake.”
New York Fed President John Williams declined to engage politically, stating that the Fed has performed well and that central bank independence remains crucial.
4. Market Outlook
Analysts at ING and Axios highlighted the risks:
Even talk of firing Powell could destabilize bond yields and increase long-term borrowing costs.
It might damage global confidence in the U.S. financial system, especially the dollar and Treasury bonds.
Investors are bracing for further volatility, especially if Trump escalates pressure on the Fed.
🧾 Summary
While no formal action has been taken, Trump’s revived comments have once again put Fed independence under political scrutiny. Financial markets are watching closely. Any move against Powell could trigger long-term instability — both in Washington and across global markets.
🔗 Official Sources:
FT News Briefing – Investment Banking Is Back
AP News – Asian Stocks React to Powell Remarks
Reuters – Dollar on Shaky Ground Amid Fed Fears
