President Trump said Thursday that Federal Reserve Chairman Jerome Powell will be “out of there” if he decides to fire him from his post, striking a harsh tone with the central bank at home while he struck an upbeat note about trade deals with the European Union and China.
Mr. Trump issued his threat as he presses the Fed to lower interest rates, saying the move would pair nicely with his efforts to cut taxes and to impose tariffs on other nations.
“If I ask him to, he’ll be out of there,” Mr. Trump said of Mr. Powell. “He’s too late, always too late, a little slow, and I’m not happy with him.”
Mr. Trump, writing on Truth Social, pointed to the European Central Bank, which cut interest rates this week in an attempt to spur growth.
He said the Fed should follow suit and, if not, that Mr. Powell’s termination “cannot come fast enough.”
“If I want him out, he’ll be out of there real fast, believe me,” Mr. Trump said during an Oval Office meeting with Italian Prime Minister Giorgia Meloni.
Mr. Powell’s term lasts until May 2026. He was promoted to the chair position by Mr. Trump during his first term and given a second term by former President Biden.
Mr. Powell has said that Mr. Trump does not have the power to fire him. The Fed is considered an independent body that makes economic decisions outside the whims of presidents.
However, the Supreme Court is set to take up a case that could make it easier for presidents to fire commissioners of independent agencies.
“I don’t think that that decision will apply to the Fed, but I don’t know. It’s a situation that we’re monitoring carefully,” Mr. Powell said Wednesday at the Economic Club of Chicago. “Generally speaking, Fed independence is very widely understood and supported in Washington, in Congress, where it really matters.”
Mr. Trump took a hard line on Mr. Powell even as he courted other nations, saying he is open to negotiations that will reduce trade barriers.
He is hopeful the U.S. will strike a trade deal with China despite an impasse between the world’s two largest economies over tit-for-tat tariffs.
Mr. Trump said he isn’t worried that Southeast Asian nations such as Vietnam, Cambodia and Malaysia will grow closer to Beijing over his hard-line stance on trade. Chinese President Xi Jinping courted those nations in person in recent days.
“Nobody can compete with us, nobody,” Mr. Trump said, underscoring the spending power of Americans. “I think we’re going to make a very good deal with China.”
Ms. Meloni, meanwhile, is serving as a critical liaison between the U.S. and European Union, as the leader of a populist-right government like Mr. Trump.
The two leaders have a good relationship, but Italy wasn’t spared from his tariffs.
Italy faces Mr. Trump’s blanket 10% tariff on all foreign goods and is working — alongside the rest of the EU — to stave off a general 20% tariff after a 90-day pause for negotiations.
Ms. Meloni believes the tariffs are “wrong” but has signaled her desire to avoid a trade war with the U.S.
“That’s why I’m here,” she told White House reporters.
Ms. Meloni said if she didn’t think Mr. Trump was a reliable trade partner, she wouldn’t have traveled to Washington.
“I’m sure we can make a deal. I’m here to help all that,” she said.
A deal with China could be a thornier proposition.
Beijing says it doesn’t want a trade war, but won’t back down from one. Indeed, last week China raised its levies on U.S. imports to 125% in response to a similar tariff from the U.S.
When added to a previous 20% levy tied to fentanyl trafficking, many Chinese goods face a 145% tariff.
The White House has said the ball is in China’s court to initiate a deal.
The Fed is taking a cautious approach to cutting rates given the uncertainty around Mr. Trump’s tariff plans and its potential to increase inflation.
On Wednesday, Mr. Powell said Mr. Trump’s sweeping tariffs could put the Fed in a difficult position.
The central bank could be caught between controlling inflation and spurring economic growth, due to tariffs and other economic policies.
“If that were to occur, we would consider how far the economy is from each goal, and the potentially different time horizons over which those respective gaps would be anticipated to close,” Mr. Powell said.
Undeterred, Mr. Trump said Mr. Powell is “too late and wrong” when it comes to cutting interest rates.
“He should certainly lower them now,” Mr. Trump said.
Wall Street has been on a roller-coaster ride as investors grapple with the potential fallout from Mr. Trump’s moves.
The Dow Jones Industrial Average fell points over 500 points, or 1.33%, on Thursday though largely due to sagging UnitedHealth Group stocks from high medical costs. The S&P 500 rose 0.13% while the Nasdaq fell 0.13%.
Sen. Elizabeth Warren, a Massachusetts Democrat who’s tangled with Mr. Powell in the past, said if the chairman “can be fired by the president of the United States, it will crash markets in the United States.”
Speaking to CNBC, she said the underpinning of the markets and U.S. economy is “the idea that the big pieces move independent of the politics.”
