American President Donald Trump is preparing to appoint an interim governor of the Federal Reserve to replace Adriana D. Kugler who resigned last week. The announcement will arrive “in the next two or three days, then I will appoint one permanent one,” said the Tycoon.
Kugler’s surprise resignation
The resignation announced by Kugler, last week, allow the tenant of the White House to immediately appoint a new member and, the insiders, they take for granted that the US president will take advantage to put one of his man, perhaps even the future candidate at the helm of the Fed, as if by his own hypothesis. “His departure was a pleasant surprise,” Trump commented, adding that the person chosen to replace it could also become his candidate for the presidency of the Central Bank. “I will make a decision before the end of the week,” said the president at a press conference without indicating whether the replacement will be permanent or temporary for the remaining months of Kugler’s mandate.
Bessent out of the race
As for the appointment of the substitute for President Fed, Jerome Powell, “offender” according to the Tycoon that he had not cut interest rates and, whose mandate ends in May next year, said he said he has reduced the list of potential candidates to four, in an interview with “Squawk Box” of the CNBC. Among these indicated Kevin Hassett, director of the National Economic Council, and Kevin Warsh, a former member of the Council of Governors of the Federal Reserve, but not the Treasury Secretary, Scott Besent. “I love Scott, but he wants to stay where he is,” said Trump.
Who are the four candidates to guide the Fed
“The two Kevin are doing well and I have two other people who are doing well,” Trump said to the CNBC. “I think it will be one of these four people.”
Kevin Hasset, current director of the National Economic Council, was president of the Council of Economic Advisers in the first Trump administration. Economist with a doctorate achieved at the University of Pennsylvania, he worked for the American Enterprise Institute before entering the White House in 2017. After the resignation of 2019, Hassett returned to collaborate with the administration during the Covid pandemic.
Kevin Warsh, member of the Council of Fed Governors, from 2006 to 2011, today collaborates in the Hoover Institution. It is in favor of a decisive cut of interest rates, line several times strongly supported by Trump.
Who are the other candidates
Other possible candidates is the governor of the Fed Christopher Waller, who in the last Fed meeting voted against the decision to keep interest rates unchanged by supporting the need for a current basic rate 4.25-4.5%. The official was appointed by Trump in 2020, with a mandate that expires in 2030.
Another possible candidate could be Michelle Bowman, a member of the FOMC, also contrary to the decision to keep the rates unchanged. “Inflation has approached our goal, excluding the temporary effects of rates, and the labor market remains close to full employment. With the slowdown of economic growth this year and signs of a less dynamic labor market, I considered it appropriate to start moving gradually our moderately restrictive policy towards a neutral setting,” said Bowman, explaining his position contrary to Tassi.
