[WASHINGTON] The White House said on Thursday no decision is imminent on naming a successor to Federal Reserve Chairman Jerome Powell, after a report suggested the president could do so this summer.
“No decisions are imminent, although the president has the right to change his mind,” a White House official told AFP.
“The president has many good options to nominate as the next Federal Reserve chairman,” the official added.
Powell’s term as chief of the independent central bank ends in May 2026, and the choice of his successor by this summer or fall would be sooner than usual.
But a Wall Street Journal report late on Wednesday said President Donald Trump has considered selecting and unveiling Powell’s replacement by September or October.
His discontent with Powell could also nudge him towards an earlier announcement this summer, the Journal said.
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On Thursday, Trump told an event at the White House that it “would be helpful” if there was someone at the Fed who could lower interest rates “a little bit.”
The dollar ceded ground after the report, losing 0.7 per cent against the euro Thursday.
Analysts flagged fears surrounding the independence of the Fed if Trump were to make such an early announcement, as Powell’s likely successor could sway expectations about the path of interest rates before assuming their new role.
Trump’s potential choices include former Fed governor Kevin Warsh, National Economic Council director Kevin Hassett and Treasury Secretary Scott Bessent, the Journal reported.
While the White House has not said who is in the running to take over at the helm of the Fed, Trump has said he knew “within three or four people” who he would pick.
Trump has repeatedly expressed frustration with Powell’s cautious approach to lowering interest rates, citing benign inflation data.
He has called the Fed chair – who he nominated to lead the central bank in 2017 – “too late” in acting and a “numbskull” for not slashing rates.
Powell, however, maintains that the Fed can wait to learn more about how the economy is impacted by Trump’s tariffs before adjusting policy.
The Fed last week held the benchmark lending rate steady for a fourth straight policy meeting, at a range between 4.25 per cent and 4.50 per cent.
But officials have different views on when they should reduce rates further, with two Fed policymakers signaling since the meeting that they are open to cuts as soon as next month.
Boston Fed President Susan Collins told Bloomberg News on Thursday that it is likely too soon to slash rates in July.
“We’re only going to have really one more month of data before the July meeting,” she said, adding that she expects to need more information.
Fed Governor Michael Barr added at an event in Ohio that “there is still considerable uncertainty about tariff policies and their effects.”
“Monetary policy is well positioned to allow us to wait and see how economic conditions unfold,” he added. AFP
