JPMorgan Chase CEO Jamie Dimon emphasized Tuesday that Federal Reserve independence remains "absolutely critical" for Jerome Powell and any future Fed chair. "Playing games with the Fed tends to have negative consequences," Dimon cautioned during the bank's first-quarter earnings briefing, warning such actions could yield "exactly the opposite of what people expect."

Wall Street closely monitors the unfolding political drama in Washington, where President Trump and White House officials persistently pressure Powell to cut rates while actively considering potential successors. Powell's term as chair concludes in May next year.

For months, Trump has criticized Powell, alleging the Fed chair resists monetary easing for political and personal reasons. The president previously floated removing Powell publicly before pledging not to do so. Recently, Trump allies adopted a new pressure tactic: questioning Powell's management capabilities and congressional testimony regarding a $2.5 billion renovation of the Fed's headquarters.

Conflicting signals emerged from administration officials about the intensity of pressure on Powell. National Economic Council Director Kevin Hassett stated Sunday that presidential authority to dismiss Powell before term-end is "under study," adding Trump "certainly has the right" if justified reasons exist. However, Treasury Secretary Steven Mnuchin countered Tuesday that Trump "has said many times he is not going to fire Jay Powell," likening the public pressure to former basketball coach Bobby Knight's approach to "working the referees."

Mnuchin affirmed central bank independence as important and disclosed that formal succession planning has commenced. He expressed hope Powell would resign from the Board when his chair term expires, noting tradition dictates such departures. "Having the former Fed chair sitting on the board would be very confusing to the markets," Mnuchin warned, referencing disruptive "shadow Fed chair" speculation.

Potential successors mentioned include Hassett, former Fed Governor Kevin Warsh, and current Governor Christopher Waller. "There are a lot of great candidates," Mnuchin remarked without confirming his own consideration, adding "it's the president's decision, and it's his timeline."

Regarding future Fed leadership, Dimon stated: "We'll see... but I would say independence is absolutely critical." He noted Trump's prior assurance about not removing Powell.

When queried about market risks from Fed pressure, Wells Fargo CFO Mike Santomassimo downplayed concerns: "In terms of the risks we see today, it hasn't been a big factor."