Jerome Powell, the current Chair of the Federal Reserve, is once again in the news. Former President Donald Trump’s bizarre comments about abortion have landed him back in the news under a pile of controversy. Indeed, Trump appointed Powell as Fed chair in 2018. President Joe Biden reappointed him in 2021, and his current term ends in May 2026. Uncharacteristically, he’s been attacked from the right by Trump. He’s drawn public rebuke from major billionaires like Ray Dalio for his approach to economic policy and interest rates.
Powell himself has already recognized that the Trump administration instituted “very fundamental policy changes.” Essentially, he zeroed in on the sweeping tariffs — which ended up being “far more extensive than expected.”… I don’t want to do any harm… He expressed worry over the adverse impacts that these tariffs would have on the U.S. economy. This week, he hinted that the U.S. is already in or approaching recession.
Contrary to the dour warnings issued by Powell, President Trump overnight on Thursday vigorously attacked Powell on Twitter — including calling for his firing. The reaction of the former president was to go after Powell saying he was consistently “TOO LATE AND WRONG.” Last week, he described Powell’s latest report as “a shambles.” Trump further compared Powell unfavorably to leaders of the European Central Bank, suggesting that the Fed under Powell’s leadership has plunged into “uncharted waters.”
“Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete ‘mess!’” – Donald Trump
Powell’s views on the state of the economy and tariffs are in line with statements from other Federal Reserve Board members over the last few weeks. Other economists back Powell’s side on the economic effects of tariffs. Trump’s sharp rebuke raises questions about where monetary policy is headed going forward.
With dangerous economic uncertainty on the horizon with possible recessionary pressures, Powell’s dexterity in handling these challenges is paramount. The ongoing debate surrounding interest rates and inflation underscores the complexities facing the Fed as it seeks to stabilize the economy amid shifting political landscapes.