US Fed chair Jerome Powell's job is not in jeopardy, White House economic adviser says

VIDEO: REUTERS
Legal experts say it is not clear whether Trump could in fact dismiss Powell (above).
Legal experts say it is not clear whether Trump could in fact dismiss Powell (above).PHOTO: AFP

WASHINGTON (REUTERS) - The head of the United States Federal Reserve faces no risk of losing his job and President Donald Trump is happy with his Treasury secretary, a White House official said, in an apparent attempt to calm Wall Street nerves frayed by Mr Trump's criticism of the Fed.

Asked on Wednesday (Dec 26) if Fed chairman Jerome Powell's job was safe, White House economic adviser Kevin Hassett told reporters: "Yes, of course, 100 per cent."

Mr Trump blasted the Fed on Monday as the US economy's "only problem", and investors have closely followed reports that the President had privately discussed the possibility of firing Mr Powell.

The US central bank chief took his post early last February after being appointed by Mr Trump and has continued the path of gradual rate hikes started by his predecessor, Dr Janet Yellen.

Legal experts say it is not clear whether Mr Trump could in fact dismiss Mr Powell.

US stocks edged up on Wednesday, with the S&P 500 up 0.2 per cent in late morning trading.

Stock prices have plunged in recent weeks on concerns about the economy.

 

The S&P 500 index was on pace for its biggest percentage decline in December since the Great Depression.

Mr Hassett also said Mr Trump was happy with Treasury Secretary Steven Mnuchin, who in recent days has talked with top US bankers and convened a call with a working group of regulators who aim to keep financial markets running smoothly.

"I am highly confident that the president is very happy with Secretary Mnuchin," Mr Hassett told Fox Business Network.