❓WHAT HAPPENED: Mohamed El-Erian called for Federal Reserve Chairman Jerome Powell to step down in order to protect the Fed’s integrity.

👤WHO WAS INVOLVED: Mohamed El-Erian, Jerome Powell, President Donald J. Trump, and Treasury Secretary Scott Bessent.

📍WHEN & WHERE: El-Erian made the statement on X (formerly Twitter) on Tuesday, July 22, 2025.

💬KEY QUOTE: “If Chair Powell’s objective is to safeguard the Fed’s operational autonomy (which I deem vital), then he should resign.” – Mohamed El-Erian

🎯IMPACT: The statement adds to growing criticism of Powell and the Federal Reserve, including concerns over mission creep and lack of action toward reducing interest rates.

Renowned Egyptian-American economist Mohamed El-Erian says he is increasingly convinced that Federal Reserve Chairman Jerome Powell should announce his resignation sooner rather than later in order to protect the U.S. central bank’s independence on monetary policy. In a Tuesday morning post on X (formerly Twitter), El-Erian—who once managed investment strategy for Harvard University‘s endowment and served as chairman of former President Barack Obama’s Global Development Council—argued that the increasing scrutiny from Congress and the Trump White House leaves Powell with little choice but to step down.

“This morning, US government criticism of both Federal Reserve Chair Powell and the institution itself has broadened to include ‘mission creep’ and the effectiveness of other officials,” the President of Queens’ College, Cambridge, wrote, continuing: “The developments of the last few days reinforce my view: If Chair Powell’s objective is to safeguard the Fed’s operational autonomy (which I deem vital), then he should resign.”

“I recognize this isn’t the consensus view, which favors him staying until the end of his tenure in May. Nor is it a first best, which is simply not attainable. Yet, it’s better than what is playing out now—growing and broadening threats to Fed independence—and will undoubtedly increase should he remain in office,” the former PIMCO CEO added. El-Erian further emphasized that he believes the names being floated as potential replacements for Powell are well respected enough to calm any potential market volatility.

The National Pulse reported on Monday that Congresswoman Anna Paulina Luna (R-FL) made a formal criminal referral to the U.S. Department of Justice (DOJ), alleging that Powell made “materially false” claims to Congress. Rep. Luna states the central bank chief appeared to have committed perjury during his June 25 testimony before the Senate Committee on Banking, Housing, and Urban Affairs regarding renovations to the Federal Reserve’s headquarters. Notably, the National Capital Planning Commission is also investigating issues surrounding Powell’s oversight of the renovations.

Late Monday, U.S. Treasury Secretary Scott Bessent added his concerns regarding mission creep at the Federal Reserve to the mounting criticism Powell is facing. “It is my belief that the central bank should conduct an exhaustive internal review of its non-monetary policy operations,” Bessent said, adding: “Significant mission creep and institutional growth have taken the Fed into areas that potentially jeopardize the independence of its core monetary policy mission.”

However, despite his continued frustration with Powell and the Fed’s lack of urgency in reducing interest rates, President Donald J. Trump signaled last week that he is “not planning on doing anything” to remove Powell just yet. However, Trump reiterated that he remains “very concerned” about the central bank’s lack of action in cutting borrowing costs.