Plot to Oust Powell Intensifies

President Donald Trump has expressed dissatisfaction with Powell's leadership of the US central bank. The reason for this discontent is Powell's reluctance to further ease monetary policy, citing the potentially inflationary effects of the White House's new tariff policies, despite having cut interest rates by 75 basis points ahead of the 2024 election. Trump has been considering removing Powell from his position, but the chairman has maintained that the president lacks the authority to do so, as his term is set to end in May 2026. The criticism of Powell is growing, with the director of the Federal Housing Finance Agency, Bill Pulte, accusing him of political bias and calling for a congressional investigation. Republican lawmakers, including Senators Rick Scott and Tommy Tuberville, have also criticized Powell's actions. Additionally, Kevin Warsh, a former Federal Reserve governor, has suggested that it's time for a 'regime change' at the Fed. The Federal Reserve's independence protects Powell from arbitrary dismissal, but his critics are now using the $2.5 billion headquarters renovation as a new line of attack, alleging potential misconduct. The pressure on Powell has increased, with Treasury Secretary Scott Bessen stating that a formal process to replace him is underway, and Congresswoman Anna Paulina Luna tweeting that his firing is 'imminent'. However, Trump has denied plans to fire Powell, and the odds of a rate cut at the next Federal Open Market Committee meeting remain low, at 2.6%.