- French minister warns Powell’s dismissal could raise U.S. debt costs and unsettle markets.
- Removing Fed Chair Powell may harm dollar credibility and impact global financial trust.
- France says Powell’s ousting could cause U.S. economic instability and higher borrowing rates
French Finance Minister Eric Lombard warned about possible political intervention affecting U.S. monetary policies through public statements. In an interview with French local media, he discussed the effects of former U.S. President Donald Trump’s new comments about terminating Federal Reserve Chairman Jerome Powell. According to Lombard, Powell’s dismissal would damage financial market stability and destabilise economic conditions.
Lombard explained how trust in global markets regarding the U.S. dollar would suffer from such a move. Since Trump took office, his previous trade policies have weakened confidence in the value of the dollar. International market trust would decrease further if the Fed Chair were dismissed because this action would generate market uncertainty, leading to bond market breakdowns.
Potential Financial Risks Linked to Powell’s Removal
According to the French Minister of Finance’s remarks, firing Powell would raise U.S. interest rates for borrowing. The market typically questions central bank independence, leading to lenders requiring higher interest rates. Lombard explained that this scenario would intensify the U.S. government’s debt payments and place further financial challenges upon the institutions.
Due to these developments, the finance minister stated that rising economic instability would spread throughout the United States. Higher borrowing expenses inherent in the market decrease consumer spending and business investment. Actual economic outcomes would face negative consequences if market participants believed the central bank could not function independently of political pressures.
International Response to U.S. Monetary Policy Developments
Many leaders in the global financial sectors maintain a watchful stance regarding U.S. monetary policy decisions. The Federal Reserve is a key economic trendsetter worldwide, meaning that leadership uncertainty can affect global financial stability. A new controversy has emerged because Trump told reporters he can remove Powell from his position anytime, which has generated doubt among international government officials and market participants.
Minister Lombard says the Federal Reserve’s freedom of operation faces potential repercussions because the U.S. would need global partner support to rebuild confidence. According to his perspective, a major economic shift requires analysing global market reactions alongside evaluating long-term economic effects.
Both central bank leadership authority and political interference news continue to raise market attention as they persist through debate. Financial market participants, economic experts, and worldwide policy makers monitor these events to evaluate their effects on dollar values, interest rates, and general economic projections. The situation showcases how monetary leadership decisions maintain high sensitivity regarding their reach into domestic and international financial systems
