🔹 Trump may name his pick for Federal Reserve Chair as early as September, well ahead of Powell’s term end in 2026
🔹 The U.S. dollar dropped sharply after reports of this early announcement
🔹 Top contenders include Kevin Warsh, Larry Bessent, and David Malpass
The U.S. dollar plummeted on Thursday following a report by the Wall Street Journal that Donald Trump is considering announcing his nominee for Federal Reserve Chair months in advance, well before current chair Jerome Powell’s term expires in May 2026.
Markets reacted immediately. In Asia, the dollar slid sharply against all major currencies as investors began pricing in the potential for an early shift in Fed policy direction.
Trump Criticizes Powell, Signals He Wants Change Sooner Than Expected
Trump has repeatedly expressed discontent with Powell’s handling of interest rates, saying the Fed has been too slow to cut and that the high borrowing costs are damaging economic growth.
He is now considering making an announcement as early as September or October, a highly unusual move that could reshape market expectations and create a "shadow Fed chair" well before Powell officially leaves office.
Who Are the Front-Runners for the Fed Job?
According to sources close to the Trump camp, he is evaluating three to four serious candidates. The most talked-about names include:
🔹 Kevin Warsh – Former Fed governor known for his hawkish stance on inflation
🔹 Larry Bessent – Current Treasury Secretary and a loyal Trump ally
🔹 David Malpass – Former head of the World Bank and an advocate for rate cuts
Kevin Warsh: The Hawk Who Speaks His Mind
In a recent speech in Boston, Kevin Warsh remarked that he “wouldn’t be surprised” if Trump announced early, just to “turn a lame duck into a lame duck.”
He added:
“My fatal flaw is that I say what I believe. If the President wants someone weak, I’m probably not getting the job.”
Warsh has long criticized zero interest rate policies and believes they produce “very poor economic outcomes.” He also praised Bank of Japan Governor Kazuo Ueda as “the most talented central banker on the planet right now.”
Bessent and Malpass: Loyalty vs. Media Appeal
While Larry Bessent has publicly stated his commitment to the Treasury role, insiders say he hasn’t ruled out accepting the Fed chair position. Earlier this month, he told Congress:
“I’m happy to do whatever President Trump asks of me.”
David Malpass, meanwhile, has aligned himself with Trump’s views by publicly calling for lower rates and criticizing the Fed’s economic models. However, during private dinners and lunches, Trump is said to have voiced concerns about Malpass’s lack of media presence, questioning whether his appearance is fit for the public-facing role.
White House Sends Mixed Signals, Fed Pushes Back
While Trump circles around early action, the White House has remained vague, saying only that the Fed should follow growth-focused monetary policies.
Powell, on the other hand, insists that Fed decisions must remain independent of political pressure:
“If we make a mistake, people will pay the price for a long time.”
He added that rate cuts are still possible later this year but the Fed will proceed cautiously.
History Warns Against Political Pressure on the Fed
Since the 1970s, the Federal Reserve’s independence has been protected by law, after President Nixon pushed the central bank to cut rates ahead of his re-election, which led to years of runaway inflation.
Any return to such political interference today could shake markets, undermine investor confidence, and weaken the dollar—as Thursday’s market reaction already demonstrated.
🔻 Summary
Trump’s move to name his Fed pick ahead of time has shaken markets and weakened the dollar. His potential nominees signal a mix of monetary hawkishness and political loyalty. The real question now: will this early announcement bring stability—or further volatility?
#TRUMP , #Fed , #JeromePowell , #MarketVolatility , #usd
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