Kevin Hassett, the director of the White House’s National Economic Council, on Sunday said the Trump administration is looking at whether Donald Trump has the authority to fire Federal Reserve Chair Jerome Powell.
Powell has been repeatedly criticized by the president over the U.S. central bank’s resistance to cut interest rates despite Trump’s demands to do so.
In an interview with ABC’s “This Week,” Hassett was asked if the president has the authority to order Powell’s removal.
“That’s a thing that’s being looked into,” Hassett said. “But certainly, if there’s cause, he does.”
The U.S. Supreme Court recently suggested it could block a potential attempt to fire Powell, claiming the central bank “is a uniquely structured, quasi-private entity.”
Still, the Trump administration appears to be laying the groundwork for Powell’s removal by scrutinizing renovation work at the Fed’s headquarters in Washington, which Hassett said have exceeded their original cost by $700 million.
Hassett would not rule out Trump using the renovation project as a “predicate” to fire Powell.
“I think that whether the president decides to push down that road or not is going to depend a lot on the answers that we get to the questions that Russ Vought sent to the Fed,” Hassett told ABC’s Jonathan Karl.
Vought, the director of the Office of Management and Budget, wrote to Powell on Thursday, raising questions about the project.
“The President is extremely troubled by your management of the Federal Reserve System,” Vought said. “Instead of attempting to right the Fed’s fiscal ship, you have plowed ahead with an ostentatious overhaul of your Washington D.C. headquarters.”
Vought has since suggested an investigation should be launched into the project.
The Fed has now posted a dedicated section to its frequently asked questions page addressing some of the main issues raised by Powell’s detractors about the renovation’s price tag, including denying allegations that the project involved building new VIP dining rooms.
Despite the White House effort to pressure Powell and interfere with the Fed’s rate decisions, Hassett insisted that the administration “100% [wants] independent monetary policy.”
“But it sure looks like they need more congressional oversight on things like the way they build their buildings,” Hassett said of the Fed in a CNBC interview on Monday morning.
Hassett is among the candidates Trump was considering to replace Powell, whose term is set to end in May 2026, according to The Wall Street Journal. Former Fed governor Kevin Warsh is another strong contender, the outlet noted.
Trump has accused Powell of hurting the U.S. economy by not ceding to his call for lower interest rates.
“Well, I think if Jerome Powell stepped down, it would be a great thing. I don’t
know that he’s going to, but he should,” Trump said Saturday. “Jerome Powell’s been very bad for our country. We should have the lowest interest rate on earth, and we don’t.”
Lower rates could help the economy, but the Fed has kept them steady, citing concerns about inflation because of Trump’s tariffs.