President Donald Trump revealed he’s searching for a new Federal Reserve chairman, focusing on “three or four people,” to replace Jerome Powell. Trump expressed his desire to replace Powell due to what he perceives as the Fed chief’s negative impact on the economy. Trump has demanded lower interest rates, citing potential benefits of saving $900 billion annually in interest payments.
The current interest rate is 4.25%, and Trump’s efforts come amidst ongoing debates about monetary policy. The president believes that if the benchmark rate were lowered by three points, the U.S. government would save significant sums on interest payments. However, economists warn that lowering rates too early could have unintended consequences on inflation expectations.
Powell’s term ends in May 2026, and Trump has made his intentions clear, criticizing Powell on social media and in interviews. Despite this, Powell remains committed to waiting for data on the impact of Trump’s tariffs before making further moves. The Fed’s preferred inflation measure stands at 2.5%, above its 2% goal, but Powell is cautious about making changes amid uncertain market conditions.
Trump’s efforts have been met with skepticism from economists and experts, who emphasize the importance of careful consideration in monetary policy decisions.
Source: https://eu.usatoday.com/story/money/2025/06/25/trump-replace-powell-fed/84353474007