Would Fed Chair Jerome Powell resign if Trump asked him to? He’s got a one-word answer

Federal Reserve Chair Jerome Powell said he would not resign from his position if President-elect Donald Trump asks him to do so.

Powell, who was appointed by Trump in 2017 during his first presidential term, has had a contentious relationship with the former (and incoming) president. Powell’s term as Fed chair is set to end in May 2026.

When asked at a press conference Thursday whether he would go if asked to leave by the Trump administration, Powell responded: “No.” The question followed the Federal Open Market Committee’s decision to reduce interest rates by a quarter-percentage point.

“Not permitted under the law,” he said in response to a question about whether the president would have the power to fire or demote him.

An unnamed senior adviser to Trump reportedly told CNN that the Republican is planning to let Powell carry out the remainder of his term. During his first term, Trump heavily criticized Powell for his handling of the economy, including the pace of monetary easing.

“Jay Powell and the Federal Reserve Fail Again,” Trump tweeted in September 2019. “No ‘guts,’ no sense, no vision! A terrible communicator!”

At the time, the federal funds effective rate was set at 2.04%. Trump called on the Fed to bring it down to “ZERO, or less” in order for the U.S. to begin refinancing its debts.

Powell again skirted addressing Trump’s criticism of his decisions as Fed chair in Thursday’s briefing.

“I’m not going to get into any political things here today,” he said.

The FOMC on Thursday voted unanimously to carry out its second consecutive interest rate cut, lowering the federal funds rate by a quarter-percentage point to between 4.50% and 4.75%.

That’s a continuation, albeit a slowdown, of its jumbo, 50-basis-point reduction to the benchmark rate; its first cut in more than four years at the FOMC’s September meeting.

Questions about the direction of the U.S. economy have gained momentum in the days following Donald Trump’s presidential election victory. Several economic analyses have shown that Trump’s proposals could have knock-on effects for the economy, including raising inflation, increasing unemployment, lowering GDP, massively adding to the federal debt, hastening Social Security’s insolvency, and boosting tax rates for the vast majority of Americans.

“In the near term, the election will have no effects on our policy decisions,” Powell said.

The Fed chair said he continues to see a sustainably cooling labor market and inflation trending towards the central bank’s target level, which encouraged the committee to carry out its 25-basis-point cut.

“The economy is strong overall and has made significant progress toward our goals over the past two years,” he said. “We continue to be confident that with an appropriate recalibration of our policy stance, strength in the economy and the labor market can be maintained with inflation moving sustainably down to 2%.”