The Federal Reserve is concluding a two-day policy meeting in Washington on Wednesday. The day before, President Donald Trump kept up pressure on the head of the Federal Reserve Jerome Powell to lower interest rates.

When asked outside the White House if he wanted to demote Powell, Trump said: “Let’s see what he does, Reuters reported.

I want to be given a level playing field, and so far I haven’t been”, Trump told reporters.

Trump has repeatedly criticism Powell's rate polices since 2017, claiming that the Fed’s four rate hikes in 2018 were weakening his economic and trade policies, particularly when he deals trade issues with China.

Trump calls the Fed his biggest threat and the Fed has gone crazy under Powell, said Trump last October.

Bloomberg cited from people familiar with the matter that Trump asked White House lawyers earlier this year to explore his options for removing Powell as Fed chairman and demoting him as a Fed governor.

White House economic adviser Larry Kudlow declined to comment on the discussions months ago, but said that Trump is not considering any changes to Powell’s status.

The Fed is independent. They’ll act on their own time, in their own way,” Kudlow said.

Powell has said he does not believe the president has the power to fire him, and that he would not resign if asked, according to Reuters.

In an email with Bloomberg, Fed spokeswoman Michelle Smith said “under the law, a Federal Reserve Board chair can only be removed for cause.”

Robert C. Hockett, a law professor at Cornell Law School, whose research includes monetary law and economics, said demoting Powell might not be considered removal. But any move by Trump to do so would probably be contested by members of the Senate, which must confirm nominees for Fed chair and to the Fed’s Board of Governors, and could lead to a legal challenge over the limits of the president’s power, Hockett said.

He also said the Fed’s policy-setting Federal Open Market Committee, known as the FOMC, could act to preserve Powell’s authority. Even if Trump could ‘demote’ Powell, the FOMC could nevertheless vote to keep him on as FOMC chair, thereby neutralizing Trump’s move,” Hockett said.

Markets bet on Fed rate cut, but Wall Street strategists doubt it

Powell and fellow U.S. central bankers are facing pressures from the expectations of Trump and financial markets for three rate cuts by year’s end as economic data has weakened.

However, Goldman Sachs and UBS expected that rate cut will not happen this summer, quoted in a report by the Wall Street Journal.

Goldman Sachs' economist Jan Hatzius published a note to clients this weekend casting doubt on the insurance rate cut theory. We think the hurdle for such cuts is likely to be higher than widely believed, he wrote.

UBS thinks the Fed may not deploy rate cuts imminently, as the market is currently pricing in a rate too high, like in a recession-like scenario, which they see as unlikely.

Although the U.S. economic data is weakening, it has continually, though slowly, grown.

Eventually, as an independent organization responsible for maintaining a stable rate, the Fed will carry on doing what it should do despite outside pressures.

(REUTERS)