In light of reports suggesting that President Trump might seek to remove the head of the Federal Reserve, Speaker Mike Johnson (R-La.) expressed uncertainty on Wednesday about whether the president has that power.
“Can the president fire Jerome Powell? I’m really not sure,” Johnson, who has a background in constitutional law, told reporters. “Honestly, I wasn’t thrilled with the leadership there. But I genuinely don’t know if that authority exists. I need to look into it.”
His remarks followed a report from the New York Times indicating that Trump has written a letter requesting Federal Reserve Chairman Jerome Powell’s resignation, asking GOP lawmakers for guidance on whether to send it.
Powell has been part of the Federal Reserve Committee since his appointment by former President Obama in 2012 and was elevated to chairman by Trump in 2017. However, ever since, Trump has been vocal about his dissatisfaction with the Fed’s approach to monetary policy during the Covid-19 pandemic, especially regarding its reluctance to cut interest rates more aggressively since his return to office in January.
Earlier this month, the administration’s tone shifted regarding Powell when White House budget chief Rassel Vault mentioned looking into renovations at the Fed’s Washington headquarters.
This scrutiny has sparked speculation that Trump might leverage an increase in the renovation budget as a means to bring in someone who could monitor Powell more closely and help lower interest rates.
Despite the swirling rumors about potentially firing Powell, Trump denied that he was planning to do so on Wednesday, calling the report “not true.” However, he did leave some ambiguity, suggesting that the decision might hinge on the outcomes of Vought’s investigation.
“I won’t discount anything, but I think it’s quite unlikely as long as he has to leave because of fraud,” Trump told reporters in the Oval Office.
Johnson seems to support the idea of ousting Powell but emphasized that it’s still unclear if Trump can do so independently.
“I think new leadership could be beneficial for the Fed, and I agree with the president’s view on some of those decisions regarding interest rates,” Johnson noted. “So, we’ll see how it plays out.”
