Jerome Powell, the president of the Federal Reserve, faces a fierce alluvion of a coalition of high profile figures that threaten their possession, which extends until May 2026.
In the last two weeks, President Donald Trump, Federal Housing Finance Agency (FHFA) Director Bill Ablicte, the White House Press Secretary, Karoline Leavitt, the allies of the Congress and the Treasury Secretary, Scott Besent, have intensified the attacks, accusing Powell of mismanagement, political bias and misleading behavior.
The cryptographic community, observing acute, faces uncertainty while this coalition challenges Powell’s future and the independence of the Fed.
Are Powell’s days numbered as a food chair, or can this unprecedented storm resist?
Trump’s long dispute
Trump, who nominated Powell in 2017, has revived a dispute that began in his first mandate when he criticized rates increases as harmful to growth. He publicly considered Powell in 2019, a position that intensified after his November 2024 re -election.
On June 27, Trump called Powell a “stubborn mule”, accusing him of costing “hundreds of billions” by refusing to reduce interest rates, currently by 4.25% – 4.5%. A handwritten note, publicized by Leavitt on June 30, demanded rate reductions, citing lower rates in Japan and China.
The Federal Reserve is an independent entity. While the president pays homine to the members of the Board and Congress confirms them, the Board is intended to operate autonomously depending on their own fiscal issues analysis. In addition, rates decisions are determined through a majority vote by the Board of Governors of the Fed, not any member, including the president.
On July 3, Trump urged Powell’s immediate resignation in a real social position, claiming misconduct linked to the renewal of the Fed headquarters of $ 2.5 billion (the project began long before Powell assumed the position of president of the FED in 2018). Despite the occasional denials of firing plans, Trump’s mention of successors such as Kevin Warsh or Christopher Waller indicates the intention of remodeling Fed leadership.
The roots of this conflict track Trump’s first mandate, when he described Powell as an “enemy” larger than Xi Jinping in 2019, frustrated by increases in rates that slowed economic growth.
After winning the re -election on November 5, 2024, Trump intensified the pressure, with advisors such as Kevin Hasset exploring dismissal options after Powell refused to resign.
Housing Critique of Antart
The director of the FHFA, Bill Ablicte, has fiercely criticized Powell’s high speed policies as a threat to the real estate market.
On July 2, he demanded an investigation of the Congress, claiming that the testimony of the Senate of June 25 by Powell on the renewal of the Fed of its headquarters in Washington, DC was “misleading” and reasons for the extraction “for cause.” Supported by Senator Cynthia Lummis (R-WYO.)About said Powell misrepresented characteristics such as a VIP dining room. His positions X on June 24 and 28 accused Powell of political prejudices and inventing inflation risks driven by the rate, worsening the lack of affebility of homes with mortgage rates at 6.6%-7%. Powell has said that the characterizations of “luxury” renovations were not precise.
Expanding the campaign
Republican senators Rick Scott and Tommy Tuberville have amplified pressure on the president of the Federal Reserve, Jerome Powell, pointing to the economic impact of their leadership.
On April 28, Scott criticized Powell for supervising an “inexplicable fed” that, according to him, lost more than $ 2 billion and looked for $ 2.5 billion for a luxurious headquarters, urging responsibility for what he described as an imprudent expense. On June 17, he condemned Powell’s “horrible decisions” that carried taxpayers while fed compensation exceeded public wages, which implies that Powell supported policies that hindered growth. Tuberville has repeatedly asked Powell’s dismissal, for example, June 24.
On July 2, the judicial president of Casa Jim Jordan (R-OHIO) He pointed out the opening to the scrutinization of the president of the Federal Reserve, Jerome Powell, responding to the call of the director of the FHFA, Bill Ablicte, for an investigation by the Congress on Powell’s leadership. According to a Fox Business report, while talking with Bloomberg, Jordan said that although no specific plans had been discussed for an investigation, “everything is on the table” for supervision, emphasizing the constitutional duty of the Judicial Committee of the Chamber to supervise the executive and judicial branches.
The Secretary of the Treasury, Scott Besent, a potential successor of Powell, advised on June 30 and July 3 about nominating a new Fed governor in January 2026 or a new president in May 2026 when the Powell term ends. Warning against attempts to fire Powell due to market risks, such as a 15% sale in April 2025 linked to Trump’s rates, Besent’s rates cutting support is aligned with the impulse of the administration.
Powell’s firm defense
However, Powell’s position is enforced by legal protections.
The Federal Reserve Law allows extraction only “for cause”, as gross misconduct, reinforced by a recent ruling of the Supreme Court that protects the Fed from arbitrary dismissal. From Trump’s attacks in 2018, Powell has ruled out political pressure as “noise”, reaffirming data -based policy.
The Fed has kept rates at 4.25% – 4.5%, citing Trump rates as a source of inflationary pressure, which is expected to drive personal consumption expenses. Inflation towards 3% in 2025, which requires a cautious policy to maintain long -term expectations of 2%.
At the FOMC press conference of June 18, Powell justified the possession rates of 4.25%-4.5%, citing inflation risks driven by the rate that could carry the inflation of PCE to 3%in 2025, while emphasizing the need for summer data to evaluate the passage of consumer price.
Powell said that the strength of the economy, 4.2% unemployment and 2.5% private domestic growth, supports a cautious approach, but recognized the potential tension between employment and price stability if tariffs cause persistent inflation.
He emphasized to maintain long -term inflation expectations anchored to 2% to avoid sustained price increases and, when asked about political insults, he only focused on delivering a “good and solid American economy.”
The controversy of the renewal lacks evidence of the elimination, but talking about a “shadow chair” could undermine Powell’s authority, creating a scenario of poorly fuck leaves.
A precarious path forward
The campaign of this coalition, Trump’s ardent rhetoric, the housing criticisms, the amplification of Leavitt, the scrutiny of Congress and Besent’s succession plans, create a precarious environment. While the legal protections protect Powell, the impulse of the administration for a replacement of 2026 could make it a lame duck.
If Powell can navigate this storm while preserving the independence of the Fed is still uncertain, but his days, although they are not immediate, are far from being safe.
