Donald Trump Reduces Options for Next US Federal Reserve Chair Amid Rate Cut Debate

US President Donald Trump has expressed strong dissatisfaction with Federal Reserve Chair Jerome Powell, labeling him as “terrible” and hinting at a potential leadership change at the central bank. Trump revealed that he has narrowed down his choices for Powell’s successor to a select few candidates, raising questions about the future of the Fed’s leadership. This comes amid ongoing tensions regarding interest rate policies and inflation concerns, as Powell prepares to testify before Congress.

Trump’s Criticism of Powell

President Trump has been vocal in his criticism of Jerome Powell, particularly regarding the Fed’s interest rate policies. He has accused Powell of not acting swiftly enough to lower rates, which he believes could benefit the economy significantly. Trump’s discontent has escalated to the point where he has threatened to dismiss Powell, a move that many legal experts argue would violate the Federal Reserve’s mandate of independence. Despite previously stating that he would not fire Powell, Trump’s ongoing remarks suggest he is exerting political pressure on the Fed chair. This situation has led to speculation about whether Trump is preparing to install a new chair before Powell’s term concludes in May 2026.

Potential Successors to Powell

In light of his dissatisfaction with Powell, Trump has indicated that he has identified three or four potential candidates to succeed him. According to reports, the leading contenders include former Fed Governor Kevin Warsh, current Governor Christopher Waller, Treasury Secretary Scott Bessent, and National Economic Council Director Kevin Hassett. Each of these individuals brings a unique perspective to monetary policy, and their potential appointment could significantly influence the direction of the Federal Reserve. As Trump continues to voice his opinions on Powell’s performance, the possibility of a leadership change at the Fed remains a topic of considerable interest and speculation.

Powell’s Congressional Testimony

Jerome Powell is set to face Congress in a two-day testimony where he will address pressing issues such as inflation, employment, and monetary policy. In his prepared remarks, Powell acknowledged that inflation might rise in the near future, particularly due to new tariffs. However, he emphasized that the Fed is not in a hurry to adjust interest rates. Powell stated, “We’re not rushing,” indicating that the central bank is carefully monitoring economic conditions before making any policy changes. His testimony is expected to be contentious, as lawmakers are likely to challenge him on the Fed’s approach to managing inflation and interest rates.

Trump’s Social Media Remarks

Ahead of Powell’s testimony, Trump took to social media to criticize the Fed chair, expressing frustration over the lack of interest rate cuts in the U.S. compared to Europe. He argued that the U.S. should have implemented multiple rate cuts, which he believes would save the country billions annually. Trump’s comments reflect his ongoing campaign to pressure the Federal Reserve into adopting a more aggressive monetary policy. He concluded his post with a call for Congress to hold Powell accountable for what he perceives as incompetence, further intensifying the scrutiny on the Fed’s leadership and decision-making processes.

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