Trump Begins Process to Replace Fed Chair Powell, Says Treasury Secretary
Donald Trump has begun a “formal process” to replace Federal Reserve Chairman Jerome Powell, according to US Treasury Secretary Scott Bessent.
Speaking on Tuesday, Bessent confirmed that potential successors are already being considered. “There’s a formal process that’s already starting… There are a lot of great candidates, and we’ll see how rapidly it progresses,” he said, adding that the pace of the decision would be set by President Trump.
Powell’s current term ends in May 2026, but successors are typically named several months in advance to allow for a smooth transition. However, speculation is growing that Trump may seek to undermine Powell by naming his replacement early.
The remarks came shortly before new data showed US inflation rose slightly more than expected in June, hitting 2.7%.
Tensions between Trump and Powell have escalated in recent days. On Monday, Trump renewed his attacks on the Fed chairman, calling him a “stupid guy” and a “knucklehead,” and accusing the central bank of keeping interest rates too high. He has repeatedly demanded the Fed cut rates to 1% or lower, criticising the current 4.5% level as a drag on government borrowing.
Trump said this week: “We have a bad Fed chairman, really bad,” and expressed his desire to appoint someone “who is going to be able to lower the rates.”
Bessent also raised concerns about Powell remaining on the Fed’s board after his chairmanship ends. “Traditionally, the Fed chair also steps down as a governor… I think it’d be very confusing for the market for a former Fed chair to stay on,” he said.
Trump Calls on Fed to Cut Interest Rates After Inflation Data
Donald Trump has urged the Federal Reserve to cut interest rates “now” following the release of US inflation figures.
Despite consumer prices rising slightly more than expected—up 2.7% in June—both Wall Street stocks and US Treasury bonds rallied. Trump’s latest demand adds to his ongoing pressure on the Fed to lower rates, arguing that the current level is holding back economic growth.
The dollar edged slightly lower on Tuesday, falling 0.1% against the pound.
