By Nathan Layne

(Reuters) – U.S. President-elect Donald Trump stated in a Sunday interview that he would not attempt to replace Federal Reserve Chair Jerome Powell upon taking office in January.

"No, I don't think so. I don't see it," Trump said during NBC News' Meet the Press with Kristen Welker when asked if he would seek Powell's removal, whose term extends to 2026.

Trump expressed doubt that Powell, who he has had disagreements with regarding interest rate levels, would resign willingly.

"I think if I told him to (go), he would. But if I asked him to, he probably wouldn't," Trump noted.

During his campaign, Trump promised to lower mortgage rates and borrowing costs for U.S. households, raising the potential for conflict with Powell over interest rate policies, similar to his first term. Additionally, Trump's proposal for across-the-board tariffs could further complicate the Fed's efforts to manage inflation.

Recently, Powell asserted he would refuse to resign if Trump attempted to dismiss him, arguing that such a removal before the end of terms is "not permitted under the law."

Trump appointed Powell, a former private equity executive and Republican, to the Fed chair position in early 2018, replacing Janet Yellen, who subsequently became President Joe Biden's Treasury Secretary. Biden later reappointed Powell to his current term.

However, Trump's relationship with Powell soured, leading to frequent criticism of the Fed and its leader during his first term. In late 2018, Trump considered dismissing Powell after discontent with the Fed's interest rate hikes and publicly opposed these increases.

In early 2020, as the pandemic began, Trump criticized Powell’s decisions, asserting a right to remove him.

Trump's approach toward the Fed diverged from the traditional norm where presidents typically refrain from critiquing the central bank, which is independently accountable to Congress.

Earlier this year, Trump indicated that he should have influence over the Fed’s decisions, signaling a desire to encroach on its independence.

Traders anticipate that the Fed will lower interest rates at the upcoming Dec. 17-18 policy meeting, following recent data indicating a continued cooling in the U.S. labor market. A quarter-point cut would adjust the Fed's policy rate to the 4.25%-4.50% range, a full percentage point lower than September when the easing cycle commenced.