Sources say Bessent strongly urged Trump not to fire Powell.

According to Jinshi Data, citing the Wall Street Journal, sources said that U.S. Treasury Secretary Scott Bessent recently privately advised Trump that he should not try to remove Federal Reserve Chairman Powell. Bessent's reasons mainly focused on several themes: the potential impact on the economy and markets, the prospect of the Federal Reserve possibly cutting interest rates later this year anyway, and the political and legal obstacles that such a move might face. Bessent believes that firing Powell is unnecessary because the economy is performing well, the market is responding positively to the president's policies, and Federal Reserve officials have already signaled that they may cut interest rates twice before the end of the year. If Powell is fired before the end of his term, Powell may file a lawsuit, which could drag on until next spring, when Powell's term would end anyway. Bessent also pointed out that Governor Cookler's term will end in January next year, and Powell's term will end in May, which will give Trump one or two vacancies to fill early next year. Bessent's caution contrasts with that of some other government officials who are considering a more aggressive strategy. Trump told reporters on Tuesday that he found Bessent "reassuring." [ChainCatcher]