Former President Donald Trump vowed to replace Federal Reserve Chair Jerome Powell if re-elected, claiming the central bank leader would be “out on day one” for exceeding his mandate, according to campaign remarks reported by multiple outlets Wednesday.
The comments mark Trump’s most direct threat yet against Powell, whom he appointed in 2018 but frequently criticized for raising interest rates. “He’s political, he’s not doing his job, and if he tries to stay beyond his term, he’ll be fired,” Trump told supporters at a New Hampshire rally, though legal scholars note Fed chairs can only be removed “for cause” under the 1913 Federal Reserve Act.
Powell’s current term expires in May 2026, potentially overlapping with a second Trump administration. Analysts suggest the remarks reflect growing Republican skepticism toward Fed independence. “This crosses a red line we haven’t seen since Nixon pressured Arthur Burns,” said Georgetown University economics professor Thomas Cooke, referencing 1970s political interference.
Market reaction remained muted Wednesday, with S&P 500 futures down 0.3%. Investors appear skeptical about Trump’s ability to unilaterally remove Powell, though some warn the rhetoric could destabilize expectations. “Even loose talk about politicizing rate decisions risks amplifying volatility,” warned Morgan Stanley strategist Lisa Chen in a client note.