Trump Threatens to Fire Fed Chair as Crypto Traders Wait for FOMO

Donald Trump has hit back at Federal Reserve Chair Jerome Powell after he criticized trade tariffs and warned of dire economic consequences.

Trump responded aggressively on social media, calling Powell “Too Late Jerome” and suggesting he might be fired, challenging the Fed’s independence.

“I’m not happy with him… If I want him out, he’ll be out of there real fast, believe me,” Trump told reporters during a White House event on April 17, according to USA Today.

“‘Too Late’ should have lowered Interest Rates, like the ECB, long ago, but he should certainly lower them now. Powell’s termination cannot come fast enough,” Trump exclaimed on his own social media platform, Truth Social.

BREAKING: President Trump accuses Fed Chair Powell of “playing politics” and says that “interest rates should be coming down now.”

“Europe is cutting rates but our guy wants to play cute,” he adds.

Trump also says Powell is “terrible” and Fed officials “are not very smart…

— The Kobeissi Letter (@KobeissiLetter) April 17, 2025

Tariffs Could Hurt The Economy: Fed

Federal Reserve Chair Jerome Powell did not cut interest rates this week as many crypto traders had hoped, despite pressure following Donald Trump’s recent global tariff announcements.

US interest rates remain stubbornly high at 4.5%, which makes the cost of borrowing expensive. Powell warned that Trump’s newly imposed tariffs, particularly those on China, could lead to a dangerous economic mix of rising prices and slowing growth, or “stagflation.”

The central bank usually cuts interest rates to stimulate a flagging economy and job market. It increases rates, or keeps them higher for longer, in an attempt to lower inflation.

However, it does not appear to be having the desired effect as aggregate US inflation, derived from the Consumer Price Index, is at 2.4%, which is above the Fed’s target of 2%. Some items, such as food, have even higher inflation rates, according to the Bureau of Labor Statistics.

According to prediction markets, the probability of Powell actually being fired this year is still low.

Eliminate the noise and look at what the market is saying:

Despite all of the “fire Powell” headlines, prediction markets have been steady.

There is a mere 25% chance that Jerome Powell is out as Fed Chair in 2025, per @Kalshi. pic.twitter.com/2NbWriiWxZ

— The Kobeissi Letter (@KobeissiLetter) April 17, 2025

Impact on Crypto Markets

Trump also hinted that the US and China would “make a very good deal” soon, though Beijing hadn’t publicly committed to formal negotiations.

Trump claims that Chinese officials have shown interest in negotiations, and he appears to be using this narrative to reassure markets further, reported Santiment. However, sentiment could change at the whim of what the POTUS decides to say next.

“The retail crowd’s sentiment toward crypto still very much matters, but many would admit that their bullish or bearish narratives could be thrown out the window at any time with a quick pivot by Trump.”

As crypto traders wait for a reason to confidently FOMO in on prices, Trump has taken aim at Jerome Powell for not cutting rates. In the meantime, he has signaled that a “Very Good Deal” with China may be around the corner. We break it all down. https://t.co/00Ch1jhpfJ

— Santiment (@santimentfeed) April 18, 2025

Crypto markets have been relatively flat this week, with total cap hovering around $2.75 trillion and Bitcoin in a wait-and-see pattern, holding above $83,000 but failing to break resistance at $86,000.