Trump Advisers Urge Interim Fed Pick Ahead Of Jerome Powell Succession Decision

President Donald Trump’s advisers are reportedly urging him to appoint a temporary Federal Reserve governor to fill an upcoming vacancy on the central bank’s board, so that he has more time to decide on a potential successor to Fed Chair Jerome Powell.

People familiar with the discussions told Bloomberg that the interim appointment would fill the seat set to be vacated by Fed Governor Adriana Kugler, who announced she will step down on August 8. The term tied to that seat expires in January 2026.

They said the short-term governor is most likely to be someone who is already in the government and someone who the Senate has previously confirmed for a federal job. They explained that such a move would allow Trump to avoid rushing a permanent nomination and preserve flexibility ahead of Powell’s term ending in May 2026. One person said that Trump is scheduled to meet with the advisers on Wednesday to discuss the same.

While the new nominee would have to clear Senate confirmation – something that usually takes months – the report said the process could be expedited if Trump pushes lawmakers to speed things up. 

Earlier this week, Trump said he would make his decision for a replacement for Kugler by Friday. “We’ll either decide on one for permanence or the four-month period — the term. You know, there’s a term of about a number of months,” Trump told reporters on Tuesday.

Trump has made no secret of his frustration with the central bank's failure to lower interest rates, specifically requesting a three-percentage-point reduction. During the July FOMC meeting, Federal Reserve Governors Christopher Waller and Michelle Bowman, both Trump appointees, voted against the decision to hold rates steady, marking the first time two members of the board had dissented since 1993.

In an interview with CNBC on Tuesday, Trump said he was considering four candidates for the post of Fed chair, including Federal Reserve Governor Kevin Warsh and National Economic Council Director Kevin Hassett. He also said that Treasury Secretary Scott Bessent had declined the role.

Meanwhile, the U.S. markets were in the green during midday trade. The SPDR S&P 500 ETF (SPY) rose 0.6%, while the SPDR Dow Jones Industrial Average ETF (DIA) gained 0.17%. The Invesco QQQ Series 1 Trust (QQQ), which tracks the tech-heavy Nasdaq 100, was up 0.78%. On StockTwits, retail sentiment around the S&P 500 ETF remained in ‘neutral’ territory. 

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