Trump says Jerome Powell wants to cut rates to help Biden win in 2024 and would not re-elect him as head of the Federal Reserve

Donald Trump said he would not keep Jerome Powell as Federal Reserve chairman and accused the bank chief of cutting interest rates to help Joe Biden win a second term in the White House.

“No, I wouldn’t do that,” Trump said when asked whether he would keep Powell after his term ends in 2026, in an interview with Fox Business Network that aired Friday.

“I think he’s going to do something to help the Democrats if he lowers rates,” Trump said.

The former president is leading the polls for the Republican presidential nomination and many expect the 2024 election to be a repeat of Biden versus Trump.

The former president insinuated that Powell would make such a move to help Biden win a second term, but warned it could backfire by increasing inflation.

“I think if he cuts rates, you have the potential to have massive inflation again,” he said of Powell. “But it looks like he’s trying to lower interest rates to maybe get people elected.”

Powell said on Wednesday that rates had peaked and he would move to a cut in the coming months, a sign of the strong US economy.

“We have six good months of inflation data and we expect more to come,” he said. “Let’s be honest: This is a good economy.”

He noted that rate cuts would come once the Fed becomes more confident that inflation will continue to fall.

Trump and Powell clashed repeatedly when Trump was in the White House and Powell refused to cut rates on orders. Trump nominated Powell to lead the central bank in 2018.

The former president has been consistent in his distaste for the Fed chief.

‘I wouldn’t reappoint him. I thought he was always late, whether it was good or bad, but he was always late,” Trump told Larry Kudlow in August.

“Let’s face it, this is a good economy,” Federal Reserve Chairman Jerome Powell said at a news conference Wednesday.

President Joe Biden and his team are using the strong economy to make the case for a second term in the White House

Biden reappointed Powell in November 2021. Powell’s term as Fed chair ends on May 15, 2026, and his term on the Board of Governors ends on January 31, 2028.

Trump would not say who he would appoint in Powell’s place.

“I would have a few choices. “I can’t tell you right now,” he said.

And when asked why the stock market was doing so well when the economy was in bad shape under Biden, Trump said traders were optimistic he would return to the White House.

“Because they think I’m going to get elected,” he said.

Powell walks a delicate line when it comes to interest rates: if you cut interest rates too quickly, inflation could rise again. If you cut them too late, unemployment could rise even further.

Meanwhile, President Biden and his team have touted the strong economy as a reason to re-elect him.

The US added 353,000 jobs in January, another sign of economic strength. The unemployment rate remained at 3.7%, just above a half-century low.

‘The American economy is the strongest in the world. Today we saw more evidence, with another month of strong wage growth and employment gains of over 350,000 in January, continuing last year’s strong growth,” Biden said in a statement.

But Democrats worry that Powell could wait too long to cut rates, and that could hurt Biden’s chances for a second term.

Then-President Donald Trump often clashed with Jerome Powell, whom he nominated as Fed chairman in November 2017 (above)

Powell has insisted that politics play no role in the bank’s calculations.

“This year is going to be a year of very big implications for the Fed and for monetary policy, and we are all very cautious and focused on doing our job,” he said at a news conference on Wednesday.

Asked in December about election-year politics, Powell said, “Once we start thinking about those things, we just can’t do that.”