Overview

• President Trump has intensified public attacks on Federal Reserve Chair Jerome Powell over the Fed's decision not to cut interest rates, fueling speculation about a potential dismissal.
• The Federal Reserve Act stipulates that governors can only be removed for 'cause,' traditionally interpreted as misconduct rather than policy disagreements.
• No U.S. president has ever attempted to fire a Fed chair, leaving the legal precedent unclear, though pending Supreme Court cases on unrelated dismissals could influence any challenge.
• If removed as chair, Powell could remain a Fed governor until January 2028, but his full removal would allow Trump to fill both a board and chair vacancy with his own nominees.
• Reports suggest Trump has considered replacing Powell with Kevin Warsh, a former Fed governor, though Warsh has reportedly advised against removing Powell before his term ends in May 2026.