Trump's Plans to Dismiss Powell Threaten Fed Credibility, Warns Officials

President Donald Trump's renewed threats to remove Federal Reserve Chair Jerome Powell have sparked widespread concern among economists, policymakers, and international officials. Critics warn that dismissing Powell could severely undermine the independence and credibility of the Federal Reserve, destabilize financial markets, and erode global trust in the U.S. dollar. Chicago Fed President Austan Goolsbee and French Finance Minister Eric Lombard both cautioned that such a move could lead to economic instability and increased debt servicing costs, while also undermining the effectiveness of U.S. monetary policy. The legal battle centers on whether the president has the authority to remove the Fed chair, with a Supreme Court precedent protecting the agency's independence now potentially up for challenge. Trump argues that Powell's reluctance to cut interest rates and criticism of his tariff policies justify his removal, but many warn this would set a dangerous precedent for political interference in central banking. Amid these tensions, global leaders and organizations urge the U.S. to prioritize cooperation and stability in its economic and monetary policies.