Trump to choose next Federal Reserve Chair, sparking speculation over potential candidates

Trump: Candidate Selection Narrowed Down to Three or ATFX trading platformFour People

On June 25th local time, U.S. President Trump disclosed publicly that he would choose the next Federal Reserve Chair from a shortlist of three to four candidates. This move is seen by outsiders as an important step in his plan to reshape monetary policy.

In fact, as early as the beginning of this month, Trump had already hinted at an upcoming announcement regarding the Federal Reserve Chair candidate. On June 6th, during a media interview, he noted that one candidate, former Federal Reserve Governor Kevin Warsh, was "highly regarded" and in the spotlight.

Criticizing Powell as "Mr. Too Late," Implies He Might Take Charge Himself

On the eve of the Federal Reserve policy decision, Trump once again attacked, criticizing Powell on June 18th at the White House as "stupid" and "too late," accusing him of being slow and overly politicized. Trump claimed he had urged the Federal Reserve multiple times to cut rates and stated, "Maybe I should go to the Federal Reserve myself."

This isn't Trump's first outburst against Powell. Since the second half of 2024, he has consistently expressed dissatisfaction with the Federal Reserve's "wait-and-see attitude" on social media and in public, believing that it failed to promptly implement rate cuts to address economic pressure.

Powell Responds: President Has No Authority to Dismiss Me

Current Federal Reserve Chair Jerome Powell was nominated by Trump in 2017 and officially assumed office in February 2018. During the Biden administration, Powell was successfully reappointed in May 2022, with his term lasting until May 2026.

Despite Trump's repeated "threats" to replace him, Powell has publicly responded, stating that under current law, the U.S. President does not have the unilateral authority to remove the Federal Reserve Chair. He emphasized that he would fulfill his duties until the end of his term.

Who Has the Best Chance to Succeed?

According to foreign media reports, Trump's potential candidates include former Federal Reserve Governor Kevin Warsh, current Governor Christopher Waller, former White House National Economic Council Director Kevin Hassett, and Treasury Secretary Scott Bessent, among others.

Among them, Waller recently expressed support for an early rate cut in July, making him a popular pick in financial circles. Analysts point out that Trump might prefer to appoint a candidate with a "more accommodating policy stance" to further his economic policy and manufacturing return agenda.

Market Concerns: Independence of Policy and "Shadow Chair" Worries

Although the president has the power to nominate the Federal Reserve Chair, it must be approved by the Senate. This procedure provides institutional security for maintaining the Federal Reserve's independence. However, the market still worries that if Trump appoints a noticeably "obedient" official, it will affect the Fed's policy neutrality.

Some analysts suggest that Trump may exert more informal influence during his term, creating a "shadow chair" situation. As one institution's economist said, "The crucial issue is whether the next chair will adjust monetary policy according to the president's sentiments."

Monetary Policy May Face Significant Turning Point

As the 2024 election approaches, Trump's approach to monetary policy is becoming increasingly clear. Whether Powell departs early or not, the choice of the new chair will influence the U.S. interest rate path, inflation control, and market expectations for the coming years, and will be a focal point of global market attention.

The market carries risks, and investment should be cautious. This article does not constitute personal investment advice and has not taken into account individual users' specific investment goals, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investing based on this is at one's own responsibility.