Overview

• President Trump and his administration are formally reviewing the process to remove Federal Reserve Chair Jerome Powell, citing dissatisfaction with his refusal to lower interest rates.
• Trump has accused Powell of politicizing the Fed and insists that lower rates are needed to stimulate the economy ahead of the 2026 midterm elections.
• Federal Reserve officials and legal experts highlight significant institutional and legal hurdles, including the need to prove 'grave fault' to justify Powell's removal.
• Treasury Secretary Scott Bessent and other administration insiders have voiced support for maintaining the Fed's independence, emphasizing its critical role in ensuring economic stability.
• A pending Supreme Court case on the removal of independent agency heads could have far-reaching implications for the Fed's autonomy and the broader structure of U.S. governance.