WASHINGTON (AP) — President Donald Trump said he plans to announce his choice for chairman of the Federal Reserve on Friday morning, a long-awaited decision that could set up a showdown on whether the U.S. central bank preserves its independence from the White House and electoral politics.
For the past year, the president has aggressively attacked Fed Chair Jerome Powell, whose term as the head of the U.S. central bank ends in May. Trump maintains that Powell should cut the Fed’s benchmark interest rates more drastically to fuel faster economic growth, while the Fed chair has taken a far more judicious approach in the wake of Trump’s tariffs because inflation is already elevated.
“I’ll be announcing the Fed chair tomorrow morning,” Trump told reporters Thursday night as he went into a screening of the documentary “Melania” about his wife. “It’s going to be, somebody that is very respected, somebody that’s known to everybody in the financial world. And I think it’s going to be a very good choice. I hope so.”
Trump stayed relatively cryptic about his pick. His search was led by Treasury Secretary Scott Bessent with four known finalists: Kevin Warsh, a former Fed governor; Christopher Waller, a current Fed governor; Rick Rieder, an executive with the financial firm BlackRock; and Kevin Hassett, director of the White House National Economic Council. Trump previously suggested Hassett was the frontrunner, only to recently say that he wanted him to remain in his current post.
Trump did say on Thursday night that “a lot of people think that this is somebody that could have been there a few years ago,” fueling speculation that he had chosen Warsh, who was a finalist in the 2017 search for Fed chair that led to Powell’s selection.
Tensions between Trump and the central bank had been steadily mounting as the president used the renovation costs of the Fed’s headquarters to further lambaste Powell, a campaign that resulted in the Fed getting subpoenas from the Justice Department earlier this month. The Fed chair took the rare step of issuing a video statement in which he said, “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”
Trump has long teased his Fed choice while saying his nominee would slash interest rates that influence the supply of money in the U.S. economy, the rate of inflation and the stability of the job market.
On the cusp of Trump’s announcement, Powell might have the ability to block him in an effort to ensure the Fed preserves its credibility by staying away from political considerations.
While his term as chair ends in roughly three months, Powell’s term on the Fed’s board of governors runs through 2028 and he could choose to remain in that post, likely blocking Trump’s ability to have his nominees control the majority of the seats on the board. Of the seven Fed governors, former President Joe Biden picked three of them in addition to renominating Powell to a second term as chair.
If Powell stays on the board, he could also create a small procedural hurdle for Trump’s ability to nominate someone new to the board. This would mean Trump would either have to choose an existing board member as chair or replace Stephen Miran, who is on leave from his job as chair of the White House Council of Economic Advisers to fill a term as governor that technically ends on Saturday. If Trump chooses to replace Miran, he could name someone new to the board.
At a Wednesday news conference, Powell declined to say whether he would leave the board. But he did offer some advice to any successor about balancing the need for independent judgment with public accountability.
“Don’t get pulled into elected politics — don’t do it,” Powell said. “Another is, that our window into democratic accountability is Congress. And it’s not a passive burden for us to go to Congress and talk to people. It’s an affirmative regular obligation.”
