Wall Street defends Powell! CEOs of major banks speak out: The independence of the Federal Reserve is the cornerstone of market confidence
Executives from major Wall Street firms emphasized the importance of Federal Reserve independence amid Trump's criticism of Powell. The CEOs of Bank of America, JPMorgan Chase, and Goldman Sachs unanimously agreed that the Fed's autonomy is the cornerstone of market confidence. Trump has repeatedly criticized Powell for failing to cut interest rates in a timely manner and has discussed potential successors. Analysts warn that if Trump were to dismiss Powell, it would trigger turmoil in financial markets and legal disputes. The executives reiterated that central bank independence is crucial for capital markets and U.S. competitiveness
According to the Zhitong Finance APP, as the long-standing conflict between U.S. President Trump and Federal Reserve Chairman Powell intensifies, senior leaders of some major Wall Street banks emphasize the importance of an independent Federal Reserve.
Bank of America CEO Brian Moynihan, along with Goldman Sachs CEO David Solomon and JPMorgan Chase CEO Jamie Dimon, highlighted the importance of the Fed's autonomy. Moynihan stated in an interview on Wednesday that the Federal Reserve "was designed to be independent."
Citigroup CEO Jane Fraser stated in a statement: "The independence of the Federal Reserve is where its credibility lies. This is crucial for our capital markets and the competitiveness of the United States."
Trump has repeatedly accused Powell of failing to take action to lower interest rates, and U.S. government officials recently confirmed that preparations are underway to select a successor—Powell's term as chairman does not end until May 2026—related work is progressing. Analysts warn that if Trump seeks to dismiss Powell, it would disrupt financial markets and trigger a serious legal dispute over central bank independence.
On Wednesday, Trump denied any intention to replace Powell. Previously, a White House official had indicated that this move was discussed during a meeting with congressional Republicans on Tuesday night. On Wednesday, Trump again criticized Powell, calling him a "moron" and accusing him of being "too late" in lowering interest rates.
Dimon stated on Tuesday that it is "crucial" for the Federal Reserve to maintain its independence. This not only means under Powell's leadership (Dimon stated he respects Powell), but also applies to whoever ultimately succeeds him. The CEO mentioned during the bank's second-quarter earnings call that intervening with the Fed "often leads to adverse consequences."
Solomon stated that the independence of the Federal Reserve, especially in terms of monetary policy, is "extremely important." He said on Wednesday: "I believe that the independence of central banks—not just in the United States, but globally—has brought us tremendous benefits. This is something we must strive to maintain."
Moynihan noted that the president also has the authority to appoint the next Federal Reserve chairman through Congress. He further pointed out that any successor must properly handle interest rate issues. He stated: "The Federal Reserve is an independent agency, and its responsibilities should extend beyond the powers of the executive branch and Congress. They will be held accountable, supervised, and scrutinized. And the fact is, they were established to maintain independence."
