Trump says he won’t try to replace Fed’s Powell

(Reuters) – The president-elect of the United States, Donald Trumpsaid in an interview aired this Sunday that he will not try to replace the chairman of the Federal Reserve, Jerome Powellupon taking office in January.

“No, I don’t think so. I don’t see that,” Trump said on NBC News’ “Meet the Press with Kristen Welker” when asked if he would try to remove Powell, whose term ends in 2026.

Trump added that he didn’t think Powell, with whom he has argued in the past about oil levels, interest rateswould leave discreetly.

“I think if I told him [para ir embora]he would do it. But if I asked, he probably wouldn’t,” Trump told Welker.

Trump campaigned on a promise to lower mortgage rates and other borrowing costs for U.S. households, raising expectations that he could clash with Powell — as he did in his first term — over interest rate policy. fees.

Trump’s pledge to implement across-the-board tariffs could also complicate the Fed’s efforts to keep inflation under control.

Last month, Powell said he would refuse to leave office early if Trump tried to remove him, arguing that removing him, or any other Fed governor, before the end of their terms is “not permitted by law.”

Trump nominated Powell, a former private equity executive and Republican, to Fed chairman in early 2018 to replace Janet Yellenwho later became President’s Treasury Secretary Joe Biden. Biden reappointed Powell to his current term.

But the relationship between Trump and Powell soured, with Trump frequently attacking the Fed and its boss during his first term. Trump even privately discussed an attempt to fire Powell in late 2018, upset with the Fed’s decision to raise interest rates, and publicly argued against raising rates.

Trump also criticized Powell in early 2020, at the start of the Covid-19 pandemic, saying Powell had made several bad decisions and arguing he had the right to fire him.

Trump’s attacks on the Fed during his first term broke decades in which presidents avoided direct criticism of the central bank, which operates with legal independence and is subject to congressional oversight.

Earlier this year, Trump said he felt he should have influence over the Fed’s decisions, an indication of his interest in interfering with the institution’s independence.

Traders expect the Fed to cut interest rates at its next policy meeting on Dec. 17-18 after recent data showed the U.S. labor market continues to cool. A quarter percentage point reduction would bring the Fed’s policy rate to the 4.25% to 4.50% range, a full percentage point below where it was in September when the central bank began its easing cycle.

(Reporting by Nathan Layne in New York)