WASHINGTON, D.C., July 16 — U.S. President Donald Trump is reportedly considering the dismissal of Federal Reserve Chair Jerome Powell, a move that could trigger significant market volatility and legal challenges, according to Bloomberg.
While no final decision has been made, a White House official told Bloomberg that Trump is “likely” to replace Powell, echoing earlier reports by Congresswoman Anna Paulina Luna, who cited a “very serious source” on social media platform X.
Several lawmakers have expressed support for Powell’s removal. However, Trump has publicly left the door open, telling reporters that “nothing is currently planned” regarding Powell’s status, but added that his removal was still possible if there was evidence of “fraud.”
“It’s highly unlikely—unless he has to go,” Trump said in a follow-up response to questions about whether he had ruled out firing the Fed chair.
Market and Legal Implications Loom
Bloomberg noted that removing the Fed Chair would represent an unprecedented move that could shake investor confidence, potentially roil financial markets, and spark a constitutional showdown over the Federal Reserve’s independence.
The Federal Reserve Act protects the Fed chair from arbitrary dismissal, though legal scholars remain divided over the president’s authority to terminate the position before the end of the statutory term.
Powell’s Future in Question
Jerome Powell has served as Chair of the Federal Reserve since 2018, and has been a member of its Board of Governors since 2012. Trump originally nominated him for the top role but has since criticized him repeatedly for not lowering interest rates amid economic pressure and inflation concerns.
The Federal Reserve most recently held its benchmark interest rate steady at 4.25–4.5%, disappointing Trump, who has called for looser monetary policy to stimulate growth.
Succession Speculation
Trump stated in June that he would announce a decision on Powell’s successor “very soon.” Bloomberg reports that potential replacements include:
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Scott Bessent, current Treasury Secretary, though the White House has denied this speculation and Bessent himself has said he has the “best job in Washington.”
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Kevin Warsh, a former Fed governor who has previously been floated for senior economic roles in Republican administrations.
The list of realistic contenders remains short, underscoring the political sensitivity and economic stakes involved in any leadership change at the central bank.
