President Donald Trump may be about to quietly back away from his attacks against the Federal Reserve Chair, according to a new report.
Politico reported on Thursday, citing sources familiar with the matter, that lawyers inside the White House have advised Trump to stop attacking Jerome Powell. Trump has attacked Powell for months over his reluctance to lower interest rates. He has also suggested that he could replace Powell before his term ends in May 2026.
Most recently, Trump has accused Powell of mismanaging the $2.5 billion renovation of the Federal Reserve headquarters and called it a fireable offense. Some Republican members of Congress have echoed Trump's calls.
Inside the White House, lawyers expressed skepticism that those arguments would hold up in court, Politico reported.
"The lawyers in recent days informally told the White House counsel’s office that it would likely lose a court fight if Trump fired Powell solely based on accusations that he mismanaged the multi-year renovation project and misled Congress about it, according to the people, who were granted anonymity to discuss internal deliberations," according to the report.
Outside of legal issues, Trump is also reportedly wary of how the financial markets would react to Powell's firing.
"Uneasy markets are also among the factors influencing Trump," the report adds. "The president worried that firing Powell would undermine the government’s ability to cheaply finance its debt, the people added. Treasury bonds, stocks and the dollar briefly fell Wednesday in response to news reports that Trump was poised to fire Powell."
