The post Jerome Powell to Resign? Trump Eyes New Fed Leadership Amid Rate Clash appeared first on Coinpedia Fintech News US President Donald Trump is frustrated with Federal Reserve Chairman Jerome Powell’s resistance to cutting interest rates, and the impact could ripple through the entire financial and crypto markets. Why Is Trump Pushing for Interest Rate Cuts? Since returning to the office in January 2025, President Trump has repeatedly called on the Fed to slash interest rates , arguing that: Lower rates will stimulate economic growth Cheaper borrowing can boost business investments and job creation The US needs competitive rates in line with other major economies But Fed Chair Jerome Powell isn’t budging. The central bank has taken a “wait-before-act” stance despite mounting political pressure. Fed Holds Steady Despite Trump’s Demands The current federal interest rate stands at 4.25%-4.50%, and no cuts have been made since December 2024. Why the delay? Inflation is creeping back up: May 2025 saw the annual inflation rate rise to 2.4%, breaking a four-month downtrend. Labour market remains strong: Jobless claims dropped from 246K to 236K, signaling economic resilience. The Fed argues that rate cuts right now could overheat the economy and fuel inflation, risking long-term instability. Will Trump Replace Jerome Powell? President Trump cannot directly fire the Fed Chair , whose term ends in May 2026, but he’s already publicly demanded Powell’s resignation. Kevin Warsh, a former Fed governor and known policy dove, is rumored to be Trump’s preferred replacement for someone more aligned with his views on rate cuts. [post_titles_links postid=”476095″] A change in leadership could reshape Fed policy, possibly triggering major financial shifts. What It Means for the Crypto Market Trump’s push for lower interest rates could turn bullish for crypto. Here’s why: Lower rates = cheaper money: This can drive more capital into risk-on assets like Bitcoin and altcoins If inflation spikes, Bitcoin could act as a hedge, strengthening its narrative as digital gold A dovish Fed could increase liquidity, pushing crypto prices higher However, the power struggle between Trump and the Fed may also lead to short-term volatility and investor uncertainty. Final Take: Political Drama, Market Opportunity? Trump’s aggressive push for rate cuts and potential reshaping of the Federal Reserve could create the perfect setup for a crypto rally, but not without turbulence.If Powell stays firm, rate cuts may come slowly. But if Trump replaces him with someone more dovish, expect faster policy shifts and possibly a surge in crypto investor confidence. [article_inside_subscriber_shortcode title=”Never Miss a Beat in the Crypto World!” description=”Stay ahead with breaking news, expert analysis, and real-time updates on the latest trends in Bitcoin, altcoins, DeFi, NFTs, and more.” category_name=”News” category_id=”6″] FAQs What are the risks of cutting rates now, given current inflation and labor market data? Cutting rates now risks reigniting inflation, as the May 2025 annual rate rose to 2.4% and the labor market remains strong (jobless claims dropped). The Fed fears overheating the economy and jeopardizing long-term stability. What could be the consequences for the broader economy if rates are cut too soon or too aggressively? Cutting rates too soon or aggressively could lead to a resurgence of inflation, erode savers’ returns, encourage excessive risk-taking in markets (like real estate), and potentially weaken the national currency, making imports more expensive. How do interest rate cuts typically affect the prices of Bitcoin and other cryptocurrencies? Interest rate cuts generally benefit crypto prices by increasing market liquidity, making borrowing cheaper, and prompting investors to move capital into “risk-on” assets like Bitcoin and altcoins, which offer potentially higher returns than bonds. How does U.S. interest rate policy compare with other major economies, and why does Trump see this as important? The U.S. Fed is holding rates steady (4.25%-4.50%), while central banks like the ECB and Bank of Canada have been cutting theirs. Trump views this divergence as a disadvantage, arguing it makes U.S. exports less competitive and complicates his trade goals.
