1. Powell’s Appointment and Early Policy Disagreements
Nomination in late 2017: Although Powell was Trump’s own pick to succeed Janet Yellen, he quickly diverged from the administration’s growth-at-all-costs stance by continuing to hike interest rates into 2018 to cool a red‑hot economy and begin quantitative tightening (shrinking the Fed’s $4.5 trillion balance sheet) .
Market volatility and Trump’s ire: As markets wobbled in late 2018—culminating in a December sell‑off—Trump publicly lamented that Powell was “raising rates too fast…and too aggressively,” calling him an “enemy” of U.S. growth .
2. “Enemy,” “Insane,” and the Push for Rate Cuts
Escalating rhetoric: Through 2019, as the China trade war heated up, Trump repeatedly accused Powell of being “always too late and wrong” and urged the Fed to follow Europe’s example by cutting rates more aggressively .
Private firing talks: According to Powell’s public statements, the president even asked White House counsel if he could remove the Fed chair—something Powell dismissed as legally dubious—and Powell vowed he would not resign voluntarily .
3. Renewed Feud in 2025: Threats to Fire Powell
Fresh salvoes: In mid‑April 2025, Trump sharply renewed his campaign against Powell for keeping U.S. rates steady—“lags behind Europe,” he charged—despite the Fed’s concern that Trump’s own tariffs fuel inflation. He publicly suggested he “has the authority” to oust Powell and is “studying” how to do so .
Market alarm: Economists warn that any attempt to remove a sitting Fed chair would eat away at the Fed’s hard‑won independence, spark volatility, and risk higher inflation or even stagflation .
4. Who Might Replace Powell?
Kevin Warsh in the wings: Reports say Trump has privately discussed elevating former Fed Governor Kevin Warsh—a critic of loose monetary policy and proponent of central-bank digital currency—as Powell’s successor. Warsh, though closer to Trump’s circle, has previously cautioned against hasty Fed firings .
5. What’s at Stake
Fed independence: The Fed’s ability to make interest‑rate decisions free of political pressure is widely seen as crucial to maintaining low, stable inflation over time. Undermining that independence could shake investor confidence and drive borrowing costs higher in the long run.
Economic outlook: With the Fed holding rates steady in 2025 after modest cuts in 2024, Powell argues further reductions risk rekindling inflation—while Trump insists lower rates are needed to spur growth amid tariff pressures .
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Current status (as of April 19, 2025)
Jerome Powell remains Fed Chair through his term—set to expire in May 2026—while the Supreme Court mulls related disputes over presidential authority to remove him. Trump’s campaign to replace him continues to loom as a flashpoint in U.S. economic policy.