Trump says he has ‘no intention of firing’ Fed boss

US President Donald Trump stated he has "no intention of firing" Jerome Powell. This follows his repeated criticism of the Federal Reserve chair. Trump expressed a desire for Powell to be "a little more active" in cutting interest rates.

In the Oval Office on Tuesday, Trump shared his optimism about trade relations with China. Last week, he intensified his criticism of Powell, calling him "a major loser." These comments led to a selloff in stocks, bonds, and the US dollar. However, financial markets have since begun to recover.

Trump's remarks came after Kevin Hassett, director of the National Economic Council, mentioned that Trump was considering whether he could dismiss Powell. Trump nominated Powell to lead the central bank in 2017 during his first term. President Joe Biden later nominated Powell for a second term at the end of 2021.

So far this year, the Fed has not cut interest rates. They lowered rates by one percentage point late last year, which Trump criticized heavily. It remains unclear if Trump has the authority to fire the Fed chair; no other president has attempted it.

On Tuesday, Trump also said he would be "very nice" in negotiations with Beijing. He indicated that tariffs would decrease if a deal is reached but not go to "zero." Earlier reports from US Treasury Secretary Scott Bessent suggested an expected de-escalation of the trade war with China.

Following these remarks, most major Asian stock markets rose on Wednesday. Japan's Nikkei 225 index increased by about 1.9%. The Hang Seng in Hong Kong climbed around 2.2%, while China's Shanghai Composite fell less than 0.1%.

This came after US shares gained on Tuesday; the S&P 500 rose by 2.5% and Nasdaq increased by 2.7%. US futures were also trading higher overnight, indicating positive market performance when trading opens.

Investors are concerned that pressure on Powell to lower interest rates may increase prices amid rising trade tariffs and inflation fears. Trade tensions between major economies and US tariffs on various countries have created uncertainty about global economic stability.

On Tuesday, the International Monetary Fund (IMF) downgraded its forecast for US economic growth this year significantly compared to other advanced economies due to tariff-related uncertainties. The IMF predicted that rising tariffs would lead to a "significant slowdown" in global growth.

Trump has imposed taxes up to 145% on imports from China and maintains a blanket tariff of 10% on other countries until July. His administration noted that new tariffs could raise levies on some Chinese goods up to 245%.

In response, China has implemented a 125% tax on US products and vowed to "fight to the end." The Chinese government has not officially responded yet but state-controlled media suggested that these remarks indicate growing recognition in the US about tariffs harming its economy more than helping it.