AP Photo/Alex Brandon
President Donald Trump announces Federal Reserve board member Jerome Powell as his nominee for the next chair of the Federal Reserve in the Rose Garden of the White House in Washington, Thursday, Nov. 2, 2017
- President Donald Trump said in a "Meet the Press" interview on Sunday that he didn't threaten to demote Federal Reserve Chairman Jerome Powell.
- The White House counsel's office had looked into whether it's legal to demote Powell to a Fed governor after Trump discussed firing him, Bloomberg first reported.
- Trump had criticized the Federal Reserve for raising interest rates ahead of the 2020 reelection.
- Trump said that he can demote Powell if he wants, but a Federal Reserve spokesperson said that a chair can only be removed "for cause" - or if that person breaks laws or regulations.
In a "Meet the Press" interview on Sunday, President Donald Trump said he didn't ever threaten to demote Federal Reserve Chairman Jerome Powell - something that the White House team reportedly looked into.
Bloomberg first reported that the White House counsel's office investigated whether it's legal to demote Powell to a Fed governor in February - an unprecedented move. Sources familiar with the matter said this happened less than two months after Trump talked about firing him.
Trump had publicly criticized Powell for raising interest rates, saying the Federal Reserve's policies have held back growth. Since 2015, the Fed has raised interest rates nine times to sustain long term growth. Leading up to the 2020 elections, Trump increased pressure on the Fed to lower interest rates, as higher interest rates can dampen the economic growth in the short term.
When Chuck Todd of "Meet the Press" asked about Trump's threat to demote Powell, Trump said, "I didn't ever threaten to demote him."
He added that he had the right to do that if he wanted to, but he has not suggested it.
"I have the right to do that," Trump said. "But I haven't said that. What he's done is $50 billion a month in quantitative tightening. That's ridiculous. What he's done is he raised interest rates too fast."
A Federal Reserve spokesperson previously said in an email, "Under the law, a Federal Reserve Board chair can only be removed for cause." This means that a chair can only be removed if that person breaks laws or regulations.
In March, Powell said in an interview with CBS' "60 Minutes" that Trump cannot fire him according to the law.
Todd asked Trump about how former President Barack Obama averaged more jobs in the last 28 months of his presidency than Trump did during his term, Trump said Obama had a Federal Reserve Chairman who kept interest rates low.
"I don't have that privilege," Trump said.