President Donald Trump would put the credibility of the dollar on the line and destabilise the US economy if he fired Federal Reserve Chair Jerome Powell, French Finance Minister Eric Lombard warned.
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“Donald Trump has hurt the credibility of the dollar with his aggressive moves on tariffs – for a long time,” Lombard said in an interview published in the La Tribune Dimanche newspaper. If Powell is pushed out “this credibility will be harmed even more, with developments in the bond market”.
The result would be higher costs to service the debt and “a profound disorganisation of the country’s economy”, Lombard said, adding that the consequences would bring the US sooner or later to talks to end the tensions.
Lombard’s comments come after Trump, frustrated with Powell’s caution to cut US interest rates, posted on social media on Thursday that Powell’s “termination couldn’t come quickly enough”.
It is not clear whether he meant he wanted to fire Powell or was eager for the end of his term, which is May next year. National Economic Council Director Kevin Hassett said on Friday that Trump was studying whether he could fire Powell.
President Emmanuel Macron has opposed Trump on a series of issues including Ukraine and trade. He has even offered refuge in France for US-based scientists whose federal research funding has been cut.