Former President Donald Trump aims to change the leadership of the Federal Reserve, targeting Jerome Powell.
Trump Intensifies Criticism of Powell
While the tension between Trump and Powell is not new, it has reached new heights. At a NATO summit, Trump called Powell 'very stupid' and 'terrible,' blaming Powell's refusal to cut interest rates for costing taxpayers hundreds of billions. Trump advocates for rates between 1% and 2%, far below the current 4.25%-4.5%. He claims that the U.S. is paying up to $900 billion more annually due to Powell's inaction.
Candidates to Replace Powell
Trump stated that he already knows 'within three or four people' who could take Powell's place. Potential candidates include former Fed Governor Kevin Warsh, current Fed Governor Christopher Waller, and Treasury Secretary Scott Bessent. Each brings a willingness for faster interest rate reductions. Bessent has openly stated he is happy to do 'whatever President Trump wants,' while Waller has shown support for earlier cuts, referencing softening inflation data.
Support from Business Leaders and Legislators
Trump is not fighting this battle alone. Business leaders and Republican lawmakers echo his call for rapid rate cuts. Cantor Fitzgerald CEO Howard Lutnick emphasized that the U.S. collects over $30 billion a month from tariffs—money that could help reduce the deficit if borrowing costs were lowered. Republicans in Congress are also applying pressure, insisting that the Fed must act as a partner, not an obstacle.
Donald Trump continues to assert the need for leadership change at the Federal Reserve, while Jerome Powell remains committed to a cautious approach, stating that rate cuts depend first on controlling inflation.
