Trump denies that he plans to fire Powell: 'Highly unlikely'

Hours after President Donald Trump told a room full of Republican lawmakers that he will fire Federal Reserve Chair Jerome Powell, he denied plans to do that.

"We're not planning on doing it," he said Wednesday at the White House. "I don't rule out anything," he added, "but I think it's highly unlikely, unless he has to leave for fraud."

At a meeting Tuesday evening in the Oval Office, Trump had asked a group of House Republicans if they thought he should fire Powell. After receiving support for the move, the president said he would follow through, according to a senior White House official.

"The President asked lawmakers how they felt about firing the Fed Chair. They expressed approval for firing him. The President indicated he likely will soon," said the official, who spoke on the condition of anonymity to speak candidly on the issue.

The members had been invited to the White House to discuss crypto regulation bills that had stalled in the House.

Separately, the New York Times reported that Trump has gone so far as to draft a letter for firing Powell, and that he showed it to lawmakers during the crypto meeting.

A Fed official declined to comment on what happened during the Oval Office meeting.

But Powell has said repeatedly that his firing is "not permitted under the law."

No president ever has attempted to fire the country's top central banker, though others have criticized prior Fed chairs.

Markets turned lower on the initial reports that Trump planned to fire Powell, but recovered after Trump denied what the White House was telling reporters.

Key players in the Trump White House have launched a multi-pronged attack on Powell to push the central bank to lower its key borrowing rate. Most recently, they have blasted Powell over renovations to the Fed's Washington headquarters, raising suspicion that Trump could try to remove the Fed leader for cause.

A recent Supreme Court decision indicated that the president does not have the authority to remove Fed officials at will.

Trump suggested that "cause" could be an issue for Powell, particularly regarding the $2.5 billion renovation of the Fed's headquarters. The project has been beset by overruns, and Powell has asked the Fed's inspector general for a review.

"Fraud is possible ... So there could be something to that," Trump said. "But I think he's not doing a good job. He's got a very easy job to do. You know what he has to do? Lower interest rates."

In a CNBC interview Wednesday, Rep. French Hill, the chair of the House Financial Services Committee, repeated that "I don't see" Trump firing Powell. Treasury Secretary Scott Bessent also told Bloomberg News on Tuesday that he didn't expect Trump to move in that direction.

However, Rep. Anna Paulina Luna, a Florida Republican who on Tuesday joined with other party members in blocking the crypto initiative, said on social media site X that a move against Powell was forthcoming.

"Hearing Jerome Powell is getting fired! From a very serious source," she wrote, later adding, "I'm 99% sure firing is imminent."

Trump nominated Powell for the chair in November 2018 to succeed Janet Yellen, who went on to become Treasury secretary under then-President Joe Biden.

The Senate confirmed Powell the following February, but has been the subject of frequent criticism from Trump, both during the president's first term and his second.

The Fed under Powell has held interest rates steady after lowering them in late 2024. Trump has charged that Powell is politically motivated and only cut in 2024 to help the prospects of Democratic nominee Kamala Harris.

"That goes for his board too, because his board is not doing the job as they should," Trump said Wednesday.

Trump appointed not only Powell but also governors Michelle Bowman, who now is the vice chair of bank supervision, and Christopher Waller.

Over the past several weeks, both have indicated a willingness to start cutting as soon as the late-July meeting of the Federal Open Market Committee, though not at a pace that Trump is suggesting.

The president has indicated he would like the Fed to lop up to 3 percentage points off the central bank's overnight borrowing rate, which is currently targeted between 4.25%-4.5%.