US President Donald Trump on Wednesday said that it is “highly unlikely” he will fire Federal Reserve Chair Jerome Powell, after signaling otherwise a day earlier in a private meeting with lawmakers.Speaking to reporters in the Oval Office, Trump left the door open but downplayed the possibility. When asked if he had completely ruled out firing Powell, he replied that he never ruled anything out but it was “highly unlikely.” But he added an exception, saying, “Unless he has to leave for fraud.”Trump further added that he had discussed the idea of firing Powell with lawmakers and said most of them supported it. However, he dismissed reports claiming he had definite plans to remove Powell, calling them “not true.”His comments came after a meeting on Tuesday with Republican lawmakers, where he reportedly talked about firing Federal Reserve Chair Jerome Powell. According to CNN, Trump asked the lawmakers what they thought about the idea, and some supported it. He even pointed to a paper that he said was a letter firing Powell.Trump’s latest complaint focuses on a planned $2.5 billion renovation of the Federal Reserve’s headquarters.Speaking to reporters, Trump said: “I think he’s terrible… But the one thing I didn’t see him as a guy that needed a palace to live in.” He added that talking to Powell was like “talking to a chair” because of his lack of personality.Trump has long been frustrated with Powell, particularly for not cutting interest rates. He has criticised the cost of the planned renovations, saying: “But the one thing I would have never guessed is that he would be spending $2.5 billion to build a little extension onto the Fed.”Trump’s senior aides have also joined the criticism. Peter Navarro, a senior counselor for trade and manufacturing, called Powell one of the worst Fed chairs in history in a published opinion piece. Others have urged Congress to investigate Powell’s actions.Despite these developments, many have warned that removing the Federal Reserve chair could have serious consequences for the US economy. On Wednesday morning, the US dollar index fell by 0.8% following reports that the president was considering Powell’s dismissal. However, after Trump’s comments from the Oval Office, the index recovered slightly and was down only 0.3% by midday.Several Republican senators expressed concern about the idea. Senator John Kennedy of Louisiana warned that firing Powell could crash both the stock and bond markets.“If you fire the chairman of the Federal Reserve, you will see the stock market crash, and you will see the bond market crash,” Kennedy said.Senator Thom Tillis of North Carolina said it would be a “colossal mistake,” arguing it would send a “shock wave” around the world about the central bank’s independence.Earlier, Bloomberg reported that President Trump had suggested Treasury Secretary Scott Bessent as a possible replacement for Federal Reserve Chair Jerome Powell. However, Trump indicated that Bessent is not a top candidate, citing his strong performance in his current role.
