Trump: Probably will name temp Fed gov over next three days

Trump: Probably will name temp Fed gov over next three days

Donald Trump is expected to announce the appointment of a temporary Federal Reserve governor to fill the soon-to-be vacant seat on the central bank's board within the next three days. This move comes as Fed Governor Adriana Kugler plans to vacate her role on August 8, giving Trump a window to influence the central bank's direction before Jerome Powell's tenure ends in May 2026.

According to sources familiar with the discussions, Trump is considering a short-term governor who is already in the government and has previously been confirmed by the Senate for a federal job. This individual will need to clear Senate confirmation, a process that typically takes months but could be expedited if Trump pressures lawmakers to quickly fill the seat [1].

Trump's advisers are weighing whether to fill the seat with a temporary governor or someone who could potentially be elevated to Fed chair next year. The decision is expected to be announced by Trump this week, and no decision should be deemed final until officially announced by the White House [1].

Kugler's early departure provides Trump with an opportunity to appoint a governor who aligns more closely with his preference for lower interest rates. Trump has been critical of the Fed, arguing that the central bank is keeping the federal government's debt-servicing costs too high and restraining economic growth. However, the addition of a dovish governor to the Federal Open Market Committee (FOMC) is unlikely to yield an immediate shift in policy, as a majority vote is required to adjust rates [1].

Among the broader group of 19 policymakers who participate in FOMC meetings, a majority signaled in June that they expect two rate cuts this year, making a move in September a strong possibility. Two Fed governors, Christopher Waller and Michelle Bowman, both Trump appointees, voted against the July decision to hold rates steady, the first time two members of the board had dissented since 1993 [1].

Trump is considering four candidates for the post of Fed chair, including Federal Reserve Governor Kevin Warsh and National Economic Council director Kevin Hassett. Treasury Secretary Scott Bessent has indicated that he does not want to be considered for the post [1].

References:
[1] https://financialpost.com/news/trump-advisers-push-temporary-fed-governor
[2] https://www.cbsnews.com/chicago/news/immigration-judges-fired-trump-administration/
[3] https://finance.yahoo.com/news/trump-advisers-push-temporary-fed-143555581.html