Political Uncertainty Around Fed Chair Could Inflate U.S. Borrowing Costs by $58 Billion Annually

Ousting Federal Reserve Chair Jerome Powell risks adding nearly $60 billion to annual U.S. borrowing costs as markets react to political interference in monetary policy. Treasury yields WOULD spike on concerns over inflation control and institutional stability, warns TD Securities strategist Gennadiy Goldberg.

The warning follows former President Trump's renewed threats to dismiss Powell, citing cost overruns in the Fed's headquarters renovation. "I don't rule out anything," TRUMP told reporters, maintaining his longstanding criticism of Powell's interest rate decisions.

Market analysts emphasize that even perceived political pressure on the Fed could trigger risk premiums in Treasury markets. The $58 billion estimate reflects only immediate interest cost impacts, excluding potential long-term damage to the Fed's inflation-fighting credibility.