Donald Trump wants Jerome Powell out. He calls the FED chair “stupid” and a “stubborn mule.” Trump thinks Powell’s interest rates are hurting America. He says rates should be cut fast to boost growth. Powell, however, keeps saying the FED needs to wait.
Trump believes lower interest rates will help the economy and the government’s debt plans. He argues that the FED is blocking this with its cautious stance. Powell, on the other hand, insists that sudden cuts may trigger higher inflation. The tension between them is growing as Trump prepares for his new economic plans. Interest rates have now become the frontline of this battle.
FED Faces Pressure: Trump Demands Big Cuts
Trump is not asking for small cuts. He wants the FED to slash interest rates by 2.5 percentage points. This is way more than the 0.5-point cut the FED is hinting at by the end of 2025. Trump is clear: if Powell won’t cut, he wants him gone.
He has threatened to replace Powell before his term ends in 2026. Trump says he has “three or four” candidates ready who will cut rates. Names like Kevin Warsh and Scott Bessent are floating around. Trump is ready to pick a chair who will match his aggressive rate-cut plans. The FED now faces intense political pressure to change its cautious course.
The Idea of a Shadow FED Chair Shakes Markets
Trump is considering an unprecedented move. He wants to name a “shadow” FED chair before Powell’s term ends. This would mean two voices speaking on monetary policy at the same time. Markets fear confusion, while some experts call it a “terrible idea.”
If this happens, traders will need to watch both Powell and Trump’s pick. A shadow FED chair could disrupt markets, weaken the dollar, and shake investor confidence. Trump, however, believes it will push the current FED to cut interest rates faster. This plan could also damage the FED’s independence. The world has never seen this before, and the crypto markets will watch how this impacts liquidity flows and sentiment.
Trump’s Next Moves: The Search for a New FED Chair
Trump is done waiting. He wants a FED chair who will align with his fiscal plans and low-rate goals. He says he will only appoint someone who will cut interest rates. Trump argues that high rates punish the middle class and hurt the economy.
As trade deals and tariff deadlines approach, Trump is rushing to align monetary policy with his economic strategy. Powell’s wait-and-see approach does not match Trump’s aggressive timeline. Trump’s push for lower rates aims to keep borrowing costs low and fuel economic momentum. The next months will reveal if Powell can hold his ground or if Trump will force a change that reshapes America’s interest rate policy.
What This Means for Crypto Investors
Trump’s battle with the FED over interest rates matters for crypto. If Trump gets the cuts he wants, markets could see weaker dollars and cheaper borrowing. This could drive more money into crypto markets as traders seek higher returns. On the other hand, market chaos from a “shadow” FED chair could bring volatility.
Crypto investors should watch every signal from Trump and Powell. Rate cuts could boost liquidity, but instability could also spark sudden market swings. The fight over interest rates is not just about politics. It is about where the next big crypto opportunities might come from in a changing economic environment.