Analysis: If Trump challenges the Federal Reserve, Powell will have the upper hand

During Trump's campaign, he had stated that the Federal Reserve's interest rate decisions should seek his opinion. The Fed Chairman Jerome Powell did not ignore these remarks. He clearly stated that if Trump asked him to resign, he would not - because the president does not have the legal power to dismiss him. These dynamics laid a foreshadowing for confrontation between the Federal Reserve and the incoming president, with economist Dario Perkins of TS Lombard believing Powell will have an upper hand. "We are now facing a larger scale confrontation between populists and 'bond vigilantes', many people expect conflicts to erupt between Trump and Powell," wrote Perkins. "If Trump challenges the Fed, it can be imagined that Powell might 'weaponize' bond markets to teach Trump a lesson."