Now Trump wants to sack Federal Reserve Chairman

WASHINGTON: President Donald Trump has privately asked Cabinet members if he has the authority to fire Federal Reserve Chairman Jerome Powell after interest rates were increased and the stock market plummeted, US media reported.

CNN and Bloomberg, citing unnamed people familiar with the matter, said that Trump was furious when the Fed raised the key borrowing rate on Wednesday and signalled it will continue to hike rates next year.

Treasury Secretary Steven Mnuchin, however, quoted Trump as denying any plan to remove Powell.

“I never suggested firing Chairman Jay Powell, nor do I believe I have the right to do so,” Trump said, according to comments relayed on Twitter by Mnuchin.

An attempt to end Powell’s term early would be a direct attack on the independence of the powerful Fed, which plays a major role in the world’s largest economy.

It would also likely create havoc in the stock market.

Trump’s aggressive trade policies combined with the strong US dollar have already created fears of slowing US and global growth, and caused markets to retreat.

On Friday Wall Street suffered its third straight rout, ending its worst week since late 2008 at the start of the global financial crisis.

Powell, chosen by Trump for the job, took over as head of the US central bank for a four-year term in February, replacing Janet Yellen.

On Tuesday the president warned the Fed not to make “yet another mistake” by raising interest rates, the second consecutive day he had gone after the central bank on Twitter.

Trump has ignored the US president’s traditional respect for the Fed’s independence, calling the agency “crazy,““out of control” and a greater economic threat than China.

In October, Trump said he had no intention of firing Powell, but in November declared that he was “not even a little bit happy” with the Fed chairman.