Introduction
Former President Donald Trump launched a blistering attack on Federal Reserve Chair Jerome Powell, calling him ‘grossly incompetent’ and threatening legal action over costly renovations at the central bank’s campus. During a US-Saudi investment event in Washington, Trump escalated his long-running criticism of Federal Reserve leadership while simultaneously targeting Treasury officials, joking that Treasury Secretary Scott Bessent should be fired if he fails to secure lower interest rates quickly.
Key Points
- Trump threatened to fire Treasury Secretary Scott Bessent if interest rates aren't lowered quickly
- The former president suggested Powell should face lawsuits over expensive Fed campus renovations
- Comments were made during a US-Saudi investment event, highlighting political pressure on central bank independence
Unprecedented Political Pressure on Central Bank
The former president’s remarks represent one of the most direct attacks on Federal Reserve independence in recent memory, with Trump explicitly stating he’d ‘love to fire’ Powell and suggesting the Fed chair deserves to be sued. This escalation comes amid ongoing tensions between political leadership and the traditionally independent central bank, which has maintained its authority over monetary policy decisions regardless of administration changes.
Trump’s comments about Powell being ‘grossly incompetent’ mark a continuation of his public criticism dating back to his presidency, when he repeatedly pressured the Fed to lower interest rates. The specific mention of lawsuits over Federal Reserve campus renovations adds a new dimension to the criticism, suggesting Trump sees grounds for legal action beyond monetary policy disagreements.
Treasury Department in the Crosshairs
In a surprising extension of his criticism, Trump turned his attention to Treasury Secretary Scott Bessent, joking that the official should be fired if interest rates aren’t lowered quickly. ‘The only thing Scott’s blowing it on is the Fed,’ Trump told the audience at the Washington investment forum, directly linking Treasury Department performance to Federal Reserve policy outcomes.
The former president’s explicit threat – ‘Rates are too high, Scott, and if you don’t get it fixed fast, I’m going to fire your ass’ – represents an unusual conflation of Treasury Department responsibilities with Federal Reserve authority. This suggests Trump views interest rate policy as something that should fall under executive branch control rather than remaining with the independent central bank.
Broader Implications for Monetary Policy
The public dressing-down of both Federal Reserve and Treasury officials at an international investment event sends strong signals to financial markets about potential future approaches to monetary policy. Trump’s comments highlight ongoing concerns about political influence over interest rate decisions, which could have significant implications for USD stability and global confidence in American financial institutions.
Analysts note that threatening Federal Reserve leadership over policy decisions represents a fundamental challenge to the central bank’s independence, which has been a cornerstone of U.S. economic stability for decades. The explicit connection between job security and interest rate outcomes creates unprecedented pressure on monetary policy makers that could influence future decisions.
The timing of these remarks during a US-Saudi investment forum underscores how monetary policy discussions have become intertwined with international economic diplomacy. As global investors watch developments in U.S. central banking, such public criticisms could affect foreign investment decisions and international perceptions of Federal Reserve credibility.
📎 Related coverage from: bloomberg.com