【Insider: Bessent advised Trump not to dismiss Powell】

On July 20, according to the Wall Street Journal, insiders stated that U.S. Treasury Secretary Bessent recently privately advised Trump not to attempt to dismiss Federal Reserve Chairman Powell.

Bessent's reasoning mainly focused on several themes:

1. The potential impact on the economy and markets, the prospect that the Federal Reserve might lower interest rates later this year, and the political and legal obstacles this action might face.

2. Bessent believes that dismissing Powell is unnecessary because the economy is performing well, the market is responding positively to the president's policies, and Federal Reserve officials have already signaled that they may cut rates twice before the end of the year.

3. If Powell is dismissed before the end of his term, he might file a lawsuit, which could drag on until next spring, at which point Powell's term would also be ending.

4. Bessent also pointed out that the term of Governor Kugler will end in January next year, while Powell's term will end in May, which will give Trump one or two vacancies to fill at the beginning of next year.

Bessent's cautious attitude contrasts with other government officials who are considering more aggressive strategies. Trump stated to reporters on Tuesday that he finds Bessent "reassuring."