Trump Adviser Calls for Powell’s Exit as Bitcoin Faces Rate Hike Uncertainty
President Donald Trump’s chief economic adviser, Kevin Hassett, has called for former Federal Reserve Chair Jerome Powell to step down from the central bank’s board. The demand follows an internal watchdog report that highlighted management failures related to the renovation of the Fed’s Washington headquarters. Hassett, speaking on Fox News’ *Sunday Morning Futures*, stated, "I think that it’s time for him to move on and to respect the independence of the Fed." President Trump separately echoed the call, urging Powell to be "forced to resign from the Board."
Powell’s potential departure carries implications for Bitcoin and broader financial markets. Although he no longer serves as Fed chair, having been replaced by Kevin Warsh in May, he remains a voting member of the Federal Open Market Committee (FOMC). If Powell resigns, Trump would have the opportunity to nominate a replacement, subject to Senate confirmation. The impact on Bitcoin would depend on whether the new governor alters expectations for future interest rate hikes.
Bitcoin has shown resilience despite recent Fed rate hikes, recovering after September’s increase due to renewed demand for spot Bitcoin ETFs. However, high Treasury yields continue to pose a challenge, offering investors an alternative with lower risk. Market expectations for another rate hike in October have declined following weak September payroll data, but another increase remains possible later this year. Bitcoin’s price movements have closely tracked changes in Fed policy expectations, underscoring the cryptocurrency’s sensitivity to monetary policy shifts.
The Justice Department has decided not to reopen a criminal investigation into Powell based on the Fed inspector general’s findings, which found no evidence of criminal wrongdoing. Powell has stated that threats of investigations left him with little choice but to remain on the board. The uncertainty surrounding his future adds another layer of complexity to the Fed’s policy direction and its potential effects on Bitcoin.