Trump ally "defects" to support Powell: No president has the right to dismiss the chairman of the Federal Reserve.

Recently, US President Trump has increased his criticisms of Federal Reserve Chairman Jerome Powell. Last Thursday, Trump publicly expressed his dissatisfaction with Powell. Last Friday, National Economic Council Director Kevin Hassett emphasized that they will "study" whether the President has the authority to dismiss the Federal Reserve Chairman. Later that day, Trump accused Powell of refusing to lower interest rates. However, last Sunday, Republican Senator John Kennedy from Louisiana stated in an interview that he believes Powell will not resign. "I believe that the President, any President, does not have the authority to dismiss the Federal Reserve Chairman," Kennedy said. "The Federal Reserve should maintain its independence." Kennedy continued to suggest that Trump and Powell "should sit down and have a cup of hot cocoa and communicate well." Powell had previously stated that if Trump asked him to resign, he would not step down from his position as Chairman. Despite being a political ally of Trump, Kennedy spoke up for Powell: "My understanding of Jay Powell is that he has a backbone. He will do what he believes is right, he will not go down in history as a Federal Reserve Chairman who let inflation run wild like a runaway horse. He will carry out the duties he believes he should." Last Wednesday, Powell pointed out in a speech in Chicago that Trump's tariff measures "far exceeded expectations" and could lead to higher inflation and economic slowdown. Powell later stated that for now, the Federal Reserve will observe the direction of Trump's economic policies before deciding whether to adjust interest rates. He stated: "Currently, we are in a favorable position to wait for the situation to become clearer before considering adjusting our policy stance." It is reported that in 2011, then President Obama nominated Powell to join the Federal Reserve Board. In 2018, Powell became the Chairman of the Board after being nominated by Trump. In 2021, then President Biden re-nominated Powell as Chairman and the Senate approved this nomination in 2022. Powell's current term will last until May 2026. Trump's actions against Powell come at a time when the US economy is facing high uncertainty. Trump's tariff strategy - wavering on tariff issues with long-time allies like Canada and Mexico, announcing increases in "reciprocal tariffs" against multiple countries globally, but then delaying their implementation - has faced resistance from both parties. Trump has long claimed that tariffs will help the US reduce its long-standing trade deficit. He has repeatedly emphasized that he believes tariffs can drive the revival of US manufacturing. However, in recent weeks, the volatility in the stock and bond markets has made many Americans increasingly anxious. American adults are becoming more dissatisfied with Trump's economic policies. The economy was a key advantage for Trump during the 2024 presidential campaign.