Trump is considering suing Fed Chairman Jerome Powell, while several prominent candidates, led by Chris Waller, are evaluated as potential successors to Powell.
Signs of tension between the White House and the Fed are increasing as Trump announces he may take significant legal action against Powell, while many financial experts and current Fed members are being considered for the next Chairman position.
MAIN CONTENT
Trump is considering suing Fed Chairman Powell over management and infrastructure issues.
The diverse candidate pool to replace Powell features Chris Waller, Rick Rieder, and many renowned experts.
Polymarket data shows Chris Waller has the highest likelihood of becoming the next Fed Chairman.
Why is Trump considering suing Fed Chairman Jerome Powell?
Trump is considering suing Fed Chairman Jerome Powell, claiming Powell has demonstrated weakness in management, particularly in the construction of the Fed's buildings.
"I am considering implementing a major lawsuit against Powell for the terrible job and extreme incompetence in managing the construction of the Fed's buildings."
Donald Trump, August 12, 2025, CNN
Previously, Trump criticized Powell's interest rate management decisions multiple times, but this is a rare instance where he emphasized the Fed's infrastructure issues. This statement indicates the increasing tension between him and the Fed leadership.
The pressure from investors and the public on the Fed's governance decisions is rising, especially as the U.S. economy is in a period of many fluctuations. If legal action occurs, it could have long-term effects on the Fed's reputation and the confidence of the financial market.
What has Trump said about Powell and the Fed leadership?
Trump continuously emphasizes dissatisfaction with Powell and the current Fed leadership, claiming they are 'too complacent' in response to economic signals.
"Fortunately, the economy is doing so well that we have outpaced Powell and the complacent leadership."
Donald Trump, August 12, 2025, CNN
Trump uses strong language to assert that the U.S. economic performance is considered superior despite Powell's policies. Many experts believe this is a way to shape public opinion to increase pressure on the Fed ahead of the new leadership selection.
Public criticism from the President towards the Fed Chairman is rare, reflecting an unprecedented level of confrontation between the executive branch and the U.S. central bank.
Who are the candidates to replace the Fed Chairman?
According to the CNBC report on August 13, 2025, the list of candidates to succeed Powell is quite diverse, including senior Fed leaders and renowned financial experts from the private sector.
"We confirm that the list of candidates to succeed Powell includes experts like Rick Rieder, David Zervos, Larry Lindsey, and some current members of the Fed."
CNBC report, August 13, 2025
Rick Rieder, Global Chief Investment Officer of BlackRock’s fixed income segment, is drawing attention for supporting interest rate cuts – a policy that many are concerned about as the U.S. economy needs stimulus. Additionally, the 'Two Kevins' including Kevin Warsh and Kevin Hassett are still being considered, as confirmed by Trump.
The list is further expanded with Vice Chair for Supervision Michelle Bowman, Governor Chris Waller, Vice Chair Philip Jefferson, and former leaders of local Feds such as Marc Summerlin, Lorie Logan (Dallas Fed), or James Bullard (St. Louis Fed). This reflects fierce competition and clear expectations for a shift in U.S. monetary policy in the near future.
What is different about the process of selecting the Fed Chairman?
This time, the process of selecting the Fed Chairman is considered particularly prolonged, and Trump does not plan to make a decision in the short term, ruling out the possibility of a 'Shadow Fed.'
Typically, publicly announcing candidate faces is seen as a strategy to test market reactions and gather broad feedback from stakeholders. According to CNBC, delaying the announcement of a new Chairman will help avoid immediate negative impacts on monetary policy and financial markets.
The context of the debates about interest rate direction and economic strategy makes this process particularly notable. The Fed plays a role in regulating interest rates and significant economic packages, so any changes in this position could affect inflation, the USD exchange rate, and U.S. economic growth.
Why is Chris Waller viewed as the top candidate?
Data from Polymarket shows Chris Waller, currently a Fed Governor, is the most promising candidate with a 27.5% chance of becoming the next Chairman.
According to Polymarket data on August 14, 2025, Chris Waller leads the likelihood of being chosen by Trump due to his stable stance and experience in managing stringent monetary policy.
Source: Polymarket, 2025
Waller's lead reflects market confidence in his interest rate management experience and a tough executive viewpoint, flexibly adapting to macroeconomic fluctuations. Currently, the Fed is still maintaining the base interest rate at 4.25–4.5% following the core CPI data for June, which increased by 0.3%, matching market expectations.
Choosing a new Chairman will determine the direction of U.S. monetary strategy amid ongoing global economic uncertainties, while also reflecting the degree of stability or change in policy views, creating significant impacts for global investors.
Comparing potential candidates for the position of Fed Chairman
The table below summarizes some notable characteristics among the main candidates most frequently mentioned in international media, according to CNBC and Polymarket in August 2025.
Candidate Name Current Position/Unit Policy Stance Polymarket Predicted Probability (%) Chris Waller Fed Governor Stable, cautious policy of maintaining or lowering interest rates 27.5 Rick Rieder BlackRock – CIO of Fixed Income Supports lowering interest rates Undetermined Michelle Bowman Fed Vice Chair for Supervision Advocates for maintaining tight control Undetermined David Zervos Jefferies Chief Market Strategist Neutral – Prefers flexibility Undetermined Kevin Warsh Former Fed Governor Currently still under consideration Undetermined
How is the Fed managing monetary policy during the transition period?
In the context of selecting a new Chairman, the Fed is keeping interest rates at 4.25–4.5% to stabilize the macro economy and curb short-term inflation. This decision was announced after the core CPI report for June showed a 0.3% increase – aligning with international financial market forecasts.
"The Fed keeps its current policy to maintain a stable foundation for the market while avoiding significant shocks during the leadership transition."
CNBC report, August 14, 2025
Maintaining stable interest rates is a necessary move to reinforce the confidence of businesses, investors, and domestic consumers in the Fed's consistent management capacity, despite changes at the top levels of governance.
The Fed's decisions during this period are being closely monitored, as any significant adjustments could lead to unpredictable developments in global markets and the U.S. economy.
Frequently Asked Questions
What issue is Trump considering suing Powell over?
According to Trump's remarks, he considers the management and construction of the Fed's buildings under Powell's tenure to be weak, which could be the reason for legal action.
Which candidates are being considered to replace Powell?
Prominent candidates include Chris Waller, Rick Rieder, Michelle Bowman, David Zervos, Kevin Warsh, and some former regional Fed leaders.
What makes Chris Waller stand out to be favored?
Waller is a Fed Governor with a consistent executive viewpoint, experience in dealing with macroeconomic volatility, and a 27.5% chance of being selected according to Polymarket.
What interest rate is the Fed maintaining and why?
The Fed maintains a base interest rate of 4.25–4.5% to ensure economic stability and control inflation during the leadership transition period.
Why is the process of selecting the Fed Chairman taking so long this year?
Due to the diverse and economically sensitive candidate pool, Trump has not rushed to make an announcement, to avoid sudden negative reactions in the market.
What role does Polymarket play in predicting the new Fed Chairman?
Polymarket compiles market bets, reflecting the probability of candidates being highly regarded by the investment community, prominently Chris Waller.
What impact does the delay in appointing a new Fed Chairman have?
The delay helps stabilize the market, avoiding negative impacts and creating time to assess the skills and views of potential candidates.
Source: https://tintucbitcoin.com/who-will-replace-jerome-powell-at-the-fed/
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