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President Donald Trump is planning to meet with advisers Wednesday about an unexpected open seat on the Federal Reserve Board of Governors, according to a person familiar with the matter.
Trump, who has been sharply critical of the Fed’s interest rate decisions, received surprise news last week when current Fed Governor Adriana Kugler announced she would leave her position at the end of this week and the White House is moving quickly to finalize her replacement.
For Trump, who is weighing his pick to replace Fed Chair Jerome Powell when his term leading the central bank concludes next May, the opening provides an early opportunity to add an additional pick to the board that aligns with his desire to cut interest rates immediately.
Kugler’s term was scheduled to end in January and White House officials had already been discussing the looming opening before the Biden nominee’s announcement. Now Trump is weighing whether to select a nominee to simply fill the final months of Kugler’s term – or one designed to serve out a full term after January.
“I’ll be making that decision before the end of the week,” Trump told reporters on Tuesday.
Trump does not appear ready to pull the trigger on his pick to replace Powell, even as he told reporters Tuesday that his list of candidates is down to four. That group includes Kevin Hassett, the current White House National Economic Council director, and former Fed Governor Kevin Warsh, Trump said. He declined to name the two other candidates, but officials have told CNN current Fed governor Christopher Waller is on the list.
The official selection process to select the next Fed chair, however, still appears to be in its relatively early stages.
“I’m putting together a list for President, the chief of staff to review,” Treasury Secretary Scott Bessent said last week on CNBC before Kugler’s announcement. “We’ll be interviewing people, so I would expect that we could have an announcement by the end of the year.”
Trump told reporters that Bessent, who had been considered a short-list candidate to replace Powell, had pulled his name out of contention and intends to stay at Treasury.
Trump may be incentivized to pick a short-term replacement for Kugler to utilize the open seat in January for his planned selection for chair. The Fed chair must be a member of the Fed Board of Governors, and even though Powell’s chairmanship ends next year, his term as governor doesn’t end until 2028.
White House officials have said they don’t expect Powell to stay on beyond his chairmanship, but Powell has declined to answer questions about his plans up to this point.
Kugler, who has publicly said she does not believe rate cuts should be imminent, will officially serve her last day at the Fed on August 8.
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