Powell Says He'll Serve Full Fed Term Despite Trump Pressure
Trump has repeatedly criticized Powell, his own pick as Fed chair, for not doing enough to boost the economy.
(Bloomberg) -- Federal Reserve Chairman Jerome Powell said he intends to serve his full four-year term as head of the Federal Reserve, after President Donald Trump asked White House lawyers earlier this year to explore options for removing him.
“I think the law is clear that I have a four-year term, and I fully intend to serve it,” Powell said at a press conference in Washington on Wednesday after policy makers met to discuss interest rates. They left the benchmark rate unchanged, while signaling a cut has become more likely.
Bloomberg News reported Tuesday that the White House counsel’s office in February examined the legality of stripping the chairmanship from Powell and demoting him back to a Fed governor. Bloomberg reported in December that Trump had discussed firing Powell amid the president’s mounting frustration over interest-rate increases last year.
Trump has repeatedly criticized Powell, his own pick as Fed chair, for not doing enough to boost the economy. The president has called for lower interest rates as he seeks to offset the headwinds created by his trade war with China, and create a favorable backdrop for his re-election campaign next year.
Trump told ABC News Friday that he disagreed with Powell “entirely,” adding that “if we had a different person in the Federal Reserve that wouldn’t have raised interest rates so much,” economic growth would have been stronger. He returned to the fray as the Fed meeting got under way Tuesday, calling out the European Central Bank for weakening the euro by pledging policy stimulus.
In addition to Powell, Trump has picked three of the other four current members of the Fed Board in Washington. They all voted in favor of the Fed’s last interest-rate increase in December.
Stephen Moore, who pulled out of consideration as Trump’s pick for a Fed board seat in May, criticized the central bank’s decision Wednesday to leave rates unchanged.
“The Fed board’s decision to keep the federal funds rate unchanged shows that the board still doesn’t get the extent of the continuing threat of deflation,” Moore said in a statement.
The president’s attacks on the Fed are a departure from almost three decades of caution in the White House about making public comments on monetary policy, out of respect for the independence of the central bank.
To contact the reporter on this story: Alister Bull in Washington at abull7@bloomberg.net
To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Ben Holland, Sarah McGregor
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