Former president criticizes Jerome Powell, hints at new nominee

Former U.S. president Donald Trump told supporters he will reveal his pick for the next Federal Reserve chair, signalling a potential shift in monetary policy should he return to office. Trump repeated his criticism that current chair Jerome Powell has kept interest rates too high and said his nominee would lower borrowing costs to stimulate growth. He promised that his chosen candidate would be a widely respected figure, fuelling speculation that former Fed governor Kevin Warsh or St. Louis Fed president Christopher Waller could be tapped. Other names circulating include BlackRock executive Rick Rieder and economist Kevin Hassett.

Observers debate implications for central bank independence

The announcement comes as inflation remains above the Fed’s 2% target and U.S. economic growth slows under the weight of higher credit costs. Powell and his colleagues have argued they need clearer evidence that price pressures are easing before cutting rates, warning that premature cuts could reignite inflation. Trump maintains that the Fed’s caution has hurt consumers and small businesses. Selecting a new chair is complex: board members serve 14‑year terms, and Powell’s term as chair runs until May 2026 while he remains on the board through 2028. Any nominee must be confirmed by the Senate, and the outcome will depend on political control. Trump’s open pressure on the Fed rekindles debate about central bank independence; economists warn that aggressive rate cuts could erode confidence in the dollar, while some conservatives argue the Fed has been too slow to support growth. Whoever leads the central bank will face the challenge of unwinding high interest rates without stoking inflation, navigating geopolitical risks and managing emerging issues like digital assets. Trump’s pledge underscores his desire to reshape the institution, and markets are watching for signs of continuity or change.