Trump Suggests He Could Consider Demoting Fed Chairman -- Update
June 18 2019 - 09:12PM
Dow Jones News
By Paul Kiernan
WASHINGTON -- President Trump ratcheted up pressure on the
Federal Reserve ahead of a major interest-rate decision, suggesting
Tuesday he could consider demoting its chairman depending on the
outcome.
"Let's see what he does," Mr. Trump said Tuesday when asked by a
reporter if he wanted to demote Fed Chairman Jerome Powell, whom he
nominated to the position in 2017.
Bloomberg News reported earlier Tuesday that, in February, the
White House Counsel's Office weighed the legality of stripping Mr.
Powell of his chairmanship but leaving him on the Fed's board of
governors.
Prior to Mr. Trump's remarks, the president's top economic
adviser, Lawrence Kudlow, declined to comment on the Bloomberg
story but denied that the White House was considering whether to
demote Mr. Powell.
Mr. Trump has called repeatedly on the Fed to lower interest
rates to boost the economy, and spoke as central bank officials are
considering whether to cut rates amid rising trade tensions and
slowing global growth. The Fed is set to announce its decision
Wednesday at 2 p.m. EDT, after the conclusion of a two-day policy
meeting.
Legal experts say it is unclear whether Mr. Trump has the
authority to remove Mr. Powell as chairman before his term as Fed
chief expires in 2022. Earlier this year, Mr. Trump appeared to
acknowledge that he didn't believe he could, telling Mr. Powell in
a phone call, "I guess I'm stuck with you," The Wall Street Journal
reported.
A Fed representative said that under the law the Fed board chair
can only be removed for cause.
Mr. Powell and other Fed officials have frequently said they
won't bow to political pressure, often noting that the central bank
is technically accountable to Congress.
When asked in January whether he would resign if the president
requested it, Mr. Powell responded "No."
Write to Paul Kiernan at paul.kiernan@wsj.com
(END) Dow Jones Newswires
June 18, 2019 20:57 ET (00:57 GMT)
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