As Trump harshly criticizes Jerome Powell's interest rate management, the US President declares plans to create a shortlist of candidates to replace the Fed chief before his term ends in 2026.
The controversy surrounding the Fed’s monetary policy has been escalating since Donald Trump took office as President. During the NATO summit in The Hague, Trump once again vehemently criticized Jerome Powell, the Chairman of the Federal Reserve, accusing him of implementing “terrible economic policies” and being “intellectually mediocre.”
According to Trump, Powell’s reluctance to lower interest rates could cost the American economy billions of dollars in the long run due to increased interest payments on public debt. The President believes that more aggressive rate cuts would be beneficial to stimulate economic activity.
In light of these disagreements, Trump confirms that he will compile a shortlist of three to four potential candidates to replace Jerome Powell when his term expires in May 2026. The names of Kevin Warsh, former Fed governor, Kevin Hassett, Director of the National Economic Council, and Christopher Waller, current central bank governor, are circulating as frontrunners.
These individuals are known for their support of more pronounced rate cuts, aligning with Trump’s economic vision.
As the political and economic dynamics evolve, the future direction of the Federal Reserve will be crucial for the years 2025-2026. With Trump considering a change in leadership, US monetary policy could undergo a significant shift, particularly if his chosen candidate adopts a more aggressive approach to interest rates.
Some market players, like Cantor Fitzgerald’s CEO Howard Lutnick, have highlighted the economic benefits of tariffs, pointing out that the United States collects over $30 billion per month through these tariffs. These funds could help reduce the federal deficit and interest payments.
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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