A possible attempt by US President Donald Trump to force the chairman of the Federal Reserve (FRS, central bank) Jerome Powell to resign could cause a crisis in the global economy. This point of view was expressed by the CNN television channel.
This could happen due to the collapse of global financial markets after the Fed reduced the key interest rate. According to Trump, the US economy needs to lower the interest rate, and the financial regulator is deliberately not doing this so that the borrowing costs for the US government remain high.
Therefore, after Powell's hypothetical premature departure, the new Fed chief, according to the television channel, will make a decision dictated by the White House to lower the interest rate. Such a move by the Trump administration would damage the reputation of the United States and provoke a decline in investor confidence, CNN believes.
Trump has previously repeatedly criticized Powell and admitted that he would want him fired. He called Powell's departure unlikely, but at the same time admitted that "he would have to leave for fraud" in a case that is "already under investigation."
Powell has repeatedly stated that he does not intend to resign. His term will end in May next year. According to US law, the chairman of the Federal Reserve cannot be dismissed by the president before the end of his term.
The Fed was created by the US Congress in 1913 as an independent organization within the federal government. It reports directly to Congress, not to the president.