US Federal Reserve Chair Jerome Powell said on Thursday that he will not step down even if President-elect Donald Trump, who has previously criticized his performance, tries to oust him once he enters office.
Powell was speaking to reporters following a meeting of the rate-setting Federal Open Market Committee, where reserve bank officials voted to cut the benchmark interest rate by a quarter percentage point to a range of 4.5% to 4.75%.
When asked whether he would quit his post at the central bank if requested by Trump, the Fed chair said simply: “No.” He subsequently opined that the president does not have the authority to fire or demote the Fed chair or any of the other Federal Reserve governors with leadership positions ahead of the end of their terms.
“Not permitted under the law,” Powell told reporters.
This is not the first time the head of the US reserve system has expressed his determination not to leave the post. Trump appointed Powell during his first presidency in 2017 but repeatedly and publicly criticized the Fed and its chair for not cutting rates fast enough. In 2019, Powell said that he would not resign even if asked by the president.
US President Joe Biden reappointed Powell in 2021, despite criticism from opponents of the decision who claimed he had burdened average Americans by keeping rates too high for too long. Powell’s term as Fed chair ends in 2026.
Trump told Bloomberg in October that he believes the US president should have more influence over the Fed’s interest rate decisions.
“I don’t think I should be allowed to order it, but I think I have the right to put in comments as to whether the interest rates should go up or down,” Trump said.
During this summer’s campaign, the Republican said that he would let Powell serve out his term, “especially if I thought he was doing the right thing,” but added that he would not reappoint him for another term.
Powell said that Trump’s election victory would have no impact on rate policy in the short run, with the Fed instead relying on economic data for its decisions.
“In the near term, the election will have no effects on our policy decisions,” the Fed chair told reporters.
Meanwhile, Trump’s former treasury secretary, Steve Mnuchin, told CNBC the president-elect will likely focus on cutting taxes and imposing tariffs, particularly on China.