Trump Fires Up! Demands Powell's Resignation After Firing BLS Director
According to sources, US President Trump announced on Friday that he would be firing the director of the Bureau of Labor Statistics (BLS), Erica McTavish, after the agency released employment reports showing a deterioration in the labor market. Trump also demanded that Federal Reserve Chairman Jerome Powell follow suit and resign, accusing him of "manipulating" the job data.
The Wall Street Journal suffered its worst one-day decline since May 21st, with bond yields plummeting.
The July nonfarm employment report released on Friday showed a much lower-than-expected increase in jobs and significant downward revisions for the previous two months, leading investors to strengthen their expectations of a rate cut by the Federal Reserve in September.
Trump posted on Truth Social, stating that "I have instructed my team to immediately fire this Obama-appointed official" and emphasized that "important data must be fair and accurate, not manipulated for political purposes."
Trump specifically highlighted that McTavish had stated that only 73,000 new jobs were added in July (a shocking figure!), but more importantly, the agency acknowledged significant errors in the previous two months' data, revising downward by 258,000 jobs. Similar incidents have occurred earlier this year, with consistent downward revisions.
The BLS director, McTavish, was nominated by former President Biden in 2023 and confirmed by the Senate in January 2024 to take office.
In another post, Trump flatly stated that the July job data had been "manipulated to smear Republicans and myself", citing instances of "sleight-of-hand" during the 2024 election period, where three days of "rosy" data were released, but then significantly revised downward on November 15th (after the election), with a correction amounting to over 818,000 jobs - a complete scam.
Trump also demanded that Powell follow suit and resign, like Adrianne Kurugeler, citing his "inaction" in lowering interest rates. Although the Federal Reserve maintained its benchmark rate unchanged for the fifth time on Wednesday, the release of stubborn inflation indicators and Friday's underwhelming nonfarm data shook market confidence, fueling concerns about the central bank's policy being too slow.
Trump stated: "'Inaction' Powell should resign, just like Biden-appointed Kurugeler did. She knew he was wrong on interest rate policy."
The Federal Reserve confirmed later that afternoon that Kurugeler had submitted her resignation to Trump. Kurugeler had skipped the monetary policy meeting this week and had previously voted in favor of maintaining the benchmark rate unchanged at four previous meetings.
As a result of the soft nonfarm data and tariff concerns, Wall Street suffered its worst single-day decline since May 21st on Friday. Traders rushed into bond markets seeking shelter, causing bond yields to plummet.