This summer's ticking time bomb: After May, Trump has the power to "fire Powell" and control the interest rate cuts of the Federal Reserve (FED) in the United States?

In May, the U.S. Supreme Court's decision could change the entire market. This article is from Wall Street News and reprinted by Foresight News. Fed officials: Fed will not be forced to cut interest rates, inflation indicators are at risk, will a lower dollar be good for bitcoin? (Background supplement: JPMorgan CEO warns: U.S. debt "sooner or later" Fed or repeat the 2020 bailout script!) Will Bitcoin benefit from the rise? There are rumors of a "change of coach" at the US Federal Reserve in the White House, a Supreme Court ruling may further shake Powell's position, and the next storm is brewing in global financial markets? On Monday, U.S. Treasury Secretary Scott Bessent said in an interview that he and President Donald Trump "have been considering" candidates for the next U.S. Federal Reserve chairmanship and plan to begin interviewing potential candidates in the fall. Public information shows that the term of the current US Federal Reserve Chairman Powell will end in May 2026, and Bescent's statement ignited the fire of speculation about the leadership change of the US Federal Reserve in advance. At the same time, the Trump administration is targeting independent institutions and asking the Supreme Court to fire officials. The analysis believes that this move may open a legal way for Trump to remove Powell, which will challenge the US Federal Reserve's long-standing independence norms. In May, focus on the U.S. Supreme Court's decision According to media reports, the Trump administration has urgently requested the U.S. Supreme Court to authorize the president to fire senior officials from two independent federal agencies (Gwynne Wilcox of the National Labor Relations Board and Cathy Harris of the Merits Protection Commission). The move was intended to challenge the precedent set in the 1935 case of Humphrey's Executor v. United States, which limited the president's power to arbitrarily remove the head of an independent agency and guaranteed the autonomy of the independent agency within the government. According to information compiled by the media, the Trump administration believes that these restrictions violate the executive power conferred on the president under Article II of the Constitution, arguing that institutions exercising major executive powers must be subject to full oversight by the president. Trump asked the Supreme Court to allow him to fire the two officials immediately, without waiting for the appeals court's final ruling, for an immediate full review — the Trump administration has said the Supreme Court should hold a special session in May to hear the case during the current judicial year, which usually begins in October and lasts until June or July. Some analysts pointed out that the final judgment of this case is a test of "whether Trump has the right to fire Federal Reserve Chairman Powell" - although the current Federal Reserve Law stipulates that there must be "just cause" for the dismissal of the chairman of the Federal Reserve, if the Supreme Court overturns the "Humphrey's Executor" case, it will undoubtedly greatly weaken this protective barrier and open the door for the president to interfere in the operation of the Federal Reserve. Bauer's "slow half-beat" annoys Trump In fact, Trump has long been dissatisfied with Bauer's monetary policy (especially interest rate decisions). Under Power's leadership, U.S. inflation is on a cooling track, but its anti-inflation efforts are now facing a new threat from Trump's trade war. The market is focused on whether Powell will choose to maintain a hawkish stance to ensure inflation does not return, or will give in to market pressures and start the rate cut cycle earlier. In this regard, the White House continued to put pressure on Bauer. Some media reported that Trump has been critical of the interest rate policy of the US Federal Reserve under the leadership of Powell, and has repeatedly pressured to cut interest rates sharply. He once publicly urged Bauer to cut interest rates in a social media post: "He is always 'half a beat slower', but now he has the opportunity to reverse the image and move fast." Despite the recent tariff shock, the US Federal Reserve has recently withstood pressure to keep interest rates unchanged. Powell also hit back earlier this month that the tighter-than-expected tariffs could trigger "persistent" inflation beyond short-term price shocks. Potential chips? U.S. dollar swap lines could affect U.S.-U.S. negotiations The impact of the Fed's wavering independence goes far beyond the prospect of a monetary policy path. Some analysts have pointed out that this potential power shift may even spill over into international relations, especially in trade negotiations with Europe. If Trump finally gains the authority to fire the Fed chairman and appoint a loyal "loyalist" at the helm, European policymakers will have to start worrying that the Dollar Swap Lines, a key bargaining chip, could be withdrawn or used as a pressure tool. The currency swap network centered on the US Federal Reserve has gradually become an important tool for the United States to defend the international status of the dollar in times of crisis. It is an important liquidity safety net for the global financial system. The U.S. Federal Reserve officially defines a currency swap as: In response to severe pressures on the global short-term dollar funding market, the Fed can establish a temporary central bank liquidity swap line (also known as a currency swap) with a foreign central bank, which can be used by the foreign central bank to provide U.S. dollar liquidity to financial institutions in its jurisdiction. And if Trump gains the power to fire the chairman of the Federal Reserve, the government can influence the operation of the swap mechanism through personnel appointments and "moral persuasion." And once such a tool is selectively used in geopolitical games, the cornerstone of the global financial system will be shaken. Take Europe, for example. Relevant data show that the dollar gap in the eurozone banking system has existed for a long time, and if the swap line support is lost, European financial institutions may face a liquidity rupture, triggering a chain reaction similar to Lehman Brothers; If the US Federal Reserve uses the withdrawal of swap quotas as a bargaining chip to weaponize this mechanism, Europe is likely to be forced to make concessions in areas such as trade and energy policy, and even affect tariff negotiations between Europe and the United States. Dollar "nuclear weapons" stronger than tariffs Wall Street News previously mentioned that Deutsche Bank analysis believes that the US Federal Reserve's dollar swap mechanism is a "nuclear weapon" that is more deterrent than tariffs. Deutsche Bank said that the US Federal Reserve's dollar swap line controls the foreign exchange swap market of about $97 trillion, equivalent to the total global GDP, and is the lifeline for non-US institutions to obtain dollar liquidity in times of crisis. If Trump sets his sights on the US Federal Reserve's dollar swap "nuclear button", the US refuses to provide dollar liquidity at a critical moment, it will trigger a serious global financial crisis. Related reports Not only the Federal Reserve, but also the asset scale of the People's Bank of China (PBOC) is also affecting the future trend of Bitcoin? From the tariff storm to the unexpected fall in CPI, can the Fed's interest rate cut ignite a global asset spree? The US CPI "unexpected fall" in March The probability of the Fed cutting interest rates has increased, but why did bitcoin and US stocks not rise but fall? 〈Unexploded bomb this summer: Trump has the right to "fire Powell" after May to control the US Federal Reserve to cut interest rates? This article was first published in BlockTempo's "Dynamic Trend - The Most Influential Blockchain News Media".