Insider: Bessent Strongly Urged Trump Not to Dismiss Powell

According to a report by Jinse Finance citing the Wall Street Journal, sources say that in recent days, U.S. Treasury Secretary Bessent has privately advised Trump not to attempt to remove Federal Reserve Chairman Powell. Bessent’s reasoning mainly centers on several themes: the potential impact on the economy and markets, the prospect that the Fed may cut rates later this year anyway, and the political and legal obstacles such a move could face. Bessent believes there is no need to dismiss Powell, given the strong economic performance, the market’s positive response to the President’s policies, and the fact that Fed officials have already signaled the possibility of two rate cuts before the end of the year. If Powell were dismissed before his term ends, he might file a lawsuit, which could drag on until next spring—coinciding with the end of Powell’s term. Bessent also pointed out that Governor Kugler’s term will end in January next year, and Powell’s will end in May, which would give Trump one or two vacancies to fill early next year. Bessent’s cautious approach contrasts with some other administration officials who are considering more aggressive strategies. On Tuesday, Trump told reporters that he found Bessent “reassuring.” (Jin10)