08.02.25

Fed Governor’s Exit Could Accelerate Trump’s Selection of Next Chair to Succeed Powell

by: Christopher Condon; Amara Omeokwe

U.S. Federal Reserve Governor Adriana Kugler's decision to resign creates an immediate opportunity for President Donald Trump to install an official at the Fed who can push for lower rates, rather than having to wait until January when her term was due to expire. While one more vote in President Trump's favor doesn't come close to ensuring a rate cut, the opening may affect his timetable to choose the next central bank chair. Fed Chairman Jerome Powell's term as chair ends in May, but his underlying post as a governor extends into 2028. If he does not depart altogether, Trump will not get another opening on the board to fill before 2028. Under that scenario, the president may be forced to fill the Kugler opening with the person he intends to promote next May. “The key implication is that this is the one vacancy that President Trump has to work with,” said Tobin Marcus of Wolfe Research. “So if he wants the next chair to come from outside the current Fed board of governors, we'll see who that person is sooner rather than later.” Whenever he makes a choice, that nominee will also require confirmation by the Senate, a process that can take months before they are installed on the board.

Read the full article on Bloomberg