US President Donald Trump has threatened to fire Federal Reserve Chair Jerome Powell if he does not step aside at the end of his term in May. The two have been embroiled in a bitter spat over Powell's reluctance to cut the central bank's interest rate, despite Trump's repeated calls. Powell's term expires on 15 May, but he is planning to remain in post until his successor, Kevin Warsh, is confirmed by the Senate.
"Then I'll have to fire him," Trump told Fox Business, when asked about Powell's plans to stay on in the job. "I've held back firing him. I've wanted to fire him, but I hate to be controversial," Trump said.
Thom Tillis, an influential Republican senator on the committee which oversees nominations for the Federal Reserve chair, has threatened to block Warsh's confirmation. If Warsh is not confirmed before Powell's term expires, he plans to stay on temporarily in the post. "That's what the law calls for.
That's what we've done on several occasions," Powell has said. Tillis has warned Trump he will not let Warsh's appointment go ahead unless a criminal investigation into Powell, linked to the renovation of the Federal Reserve building, is dropped. Senate Majority Leader John Thune, a Republican, said on Wednesday that he believed the Department of Justice should end its probe into Powell.
"I think it's in everybody's best interest to wrap up the investigation," Thune said. Another Republican senator on the banking committee, Mike Rounds, told reporters on Capitol Hill on Wednesday that the probe is not "serving our purpose, which is to help the president get the next Federal Reserve chairman he wants". Trump said he was hopeful Tillis would drop his opposition to the appointment, adding that he "is an American… he knows what to do".
But he said he was not prepared to have the probe into Powell dropped. He told Fox Business: "Don't you think we have to find out what happened there? I have to find out." Asked on Wednesday about Trump's comments, Treasury Secretary Scott Bessent said he is "very optimistic" Warsh will be confirmed before 15 May.
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