President Donald Trump has intensified his campaign against key U.S. economic institutions, firing the head of the Bureau of Labor Statistics (BLS) just hours after the release of a weaker-than-expected jobs report for July.
In a move that stunned economists and market observers, Trump dismissed BLS Commissioner Erika McEntarfer, a Biden-era appointee, accusing her—without providing evidence—of manipulating employment data to damage his administration’s image.
“She will be replaced with someone much more competent and qualified,” Trump said. “Important numbers like this must be fair and accurate. They can’t be manipulated for political purposes.”
Resignation at the Fed Deepens Uncertainty
The shake-up came on the same day Federal Reserve Governor Adriana Kugler announced her early resignation, several months ahead of her scheduled departure in January 2026. Her exit further opens the door for Trump to influence the future leadership of the Fed, especially as Fed Chair Jay Powell is expected to step down in May 2026.
Trump, who has been publicly critical of Powell’s approach to interest rates, called for his resignation, writing on Truth Social:
“’Too Late’ Powell should resign, just like Adriana Kugler… He should resign, also!”
Political Intervention Raises Alarms Over Data Integrity
The firing of McEntarfer is unprecedented in modern U.S. history and raises serious concerns about the independence of the nation’s statistical agencies. The BLS is a key source of nonpartisan data on employment and inflation—statistics that influence everything from economic policy to global financial markets.
“This is a serious blow to the integrity of the U.S. statistical system,” said David Wilcox, former head of the now-defunct Federal Economic Statistics Advisory Committee, which Trump disbanded earlier this year.
A group of former BLS leaders, Friends of BLS, issued a joint statement warning that politicizing economic data could undermine public trust and have far-reaching economic consequences, citing the deterioration of data credibility in other nations.
The Department of Labor confirmed McEntarfer’s dismissal and announced that Deputy Commissioner William Wiatrowski will serve as acting BLS head.
Markets React to Instability and Policy Uncertainty
The labor market report showed a noticeable slowdown in job growth for the third consecutive month, with significant downward revisions to May and June figures. Trump dismissed the data as “RIGGED,” claiming the report was designed to harm his political standing.
The immediate aftermath saw increased market volatility:
-
The U.S. dollar fell sharply, losing 2.3% against the yen and 1.6% against the euro.
-
Two-year Treasury yields dropped to 3.68%, reflecting investor bets on a more dovish Federal Reserve.
Analysts say Kugler’s resignation may accelerate the search for Powell’s successor. Krishna Guha of Evercore commented that the process could effectively install a “shadow Fed chair” ahead of the formal transition in 2026.
Rising Tensions Between Trump and Powell
Trump’s public dissatisfaction with Powell has grown in recent weeks over the Fed’s decision to hold interest rates at restrictive levels across the past five meetings. Last week, the president made a rare visit to the Federal Reserve’s headquarters, where he reportedly scolded Powell over monetary policy decisions and the $2.5 billion cost of the Fed’s ongoing renovation project.
“The economy is BOOMING under ‘TRUMP’ despite a Fed that also plays games,” Trump declared online. “Jerome ‘Too Late’ Powell should be put out to pasture.”
In an interview with Newsmax, Trump suggested he would fire Powell “in a heartbeat,” before acknowledging that doing so might “disturb the market.”
Outlook:
With control over both the BLS and increasing influence over the Federal Reserve, Trump is reshaping how economic data and policy are produced and presented. The moves have drawn sharp criticism from economists and investors who fear the erosion of institutional independence. The full implications for U.S. monetary policy and data credibility may unfold in the months leading to the 2026 Fed leadership transition.