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Chief executives from the four largest U.S. banks—JPMorgan Chase, Bank of America, Citigroup, and Goldman Sachs—have called this week on President Donald Trump to preserve the independence of the Federal Reserve, amid rising speculation that Fed Chair Jerome Powell may be dismissed.
The responses follow Trump’s criticism of Powell over the Fed’s increasingly hawkish monetary stance, as the president continues to hint at a possible dismissal of the central bank chief.
The CEOs of four banking titans, managing a combined $12 trillion in global assets and playing a pivotal role in the U.S. economy, warned that undermining the Fed’s independence could destabilize markets and erode investor confidence. The executives urged the administration to refrain from politicizing interest rate decisions, emphasizing that the Fed’s structure was designed to shield it from short-term political pressures.
Speaking on Tuesday, JPMorgan CEO Jamie Dimon became the first major bank executive to publicly join the debate, calling the Fed’s independence “absolutely critical.” Cautioning that political interference in monetary policy can have harmful consequences, he emphasized the importance of preserving that independence regardless of who leads the Fed.
Goldman Sachs CEO David Solomon echoed that view, stating that central bank independence “should be preserved” and has historically supported economic stability in the U.S. and globally, in an interview with CNBC on Wednesday. "I think central bank independence, not just here in the United States but around the world, has served us incredibly well,” he said.
Bank of America CEO Brian Moynihan emphasized that the Fed was “set up to be independent” and operates outside the executive and legislative branches, though he acknowledged it is within a president’s authority to appoint a new chair once Powell’s term ends in 2026.
"They are called to task, and monitored, and reviewed," Moynihan told Bloomberg TV. "The reality is they were set up to be independent."
In a statement, Citigroup's Jane Fraser argued that the "Fed’s credibility relies on its independence," which she called essential for efficient capital markets and U.S. competitiveness.
Amid warnings from the four major banks, Trump said Wednesday that removing Powell is "highly unlikely," but he did not entirely dismiss the possibility. Speaking in the Oval Office, Trump accused Powell of doing a “lousy job” and criticized his resistance to lowering interest rates amid ongoing inflation concerns.
The Fed has held the benchmark interest rate between 4.25% and 4.5% since December 2024, citing inflationary pressures, as headline inflation rose to 2.7% in June.
Trump’s remarks came after a senior White House official told CNBC that the president had informed Republican lawmakers of his intention to dismiss Powell “soon.” Trump acknowledged discussing the idea at a meeting with House Republicans the previous evening, saying many participants encouraged him to go forward with it, though he claimed to be “more conservative” than their advice.
While denying any immediate action, Trump raised questions over a renovation project at the Fed's headquarters, claiming it had ballooned to $2.7 billion and suggesting there may be fraud involved. “I don’t rule out anything,” Trump said, referencing possible legal violations but providing no evidence. Powell, appointed by Trump in 2018, has repeatedly said his removal would be unlawful.
The controversy has stirred concerns among markets about potential legal and financial repercussions if Trump were to attempt Powell’s dismissal. U.S. law does not grant the president the authority to remove a sitting Fed chair without cause, and any such move would likely trigger a legal challenge and market volatility.
Despite the public exchanges, following Trump's remarks, financial markets remained relatively stable. The Dow Jones Industrial Average rose 0.53% to 44,254.78 points, the Nasdaq gained 0.26% to 20,730.49, and the S&P 500 increased 0.32% to 6,263.7 by Wednesday’s close.
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