President-elect Donald Trump remains likely to allow Federal Reserve Chair Jerome Powell to serve out the remainder of his term, which expires in May 2026, according to a senior adviser to Trump who requested anonymity to describe private conversations.
The adviser cautioned that Trump could always change his mind, but his present view — and that of Trump’s economic team — is that Powell should remain atop the central bank as it pursues its policy of cutting interest rates. Trump in July told Bloomberg he had intended to keep Powell in his role at least for the duration of his term.
Still, Powell was peppered with questions about his job security during his first post-election press conference Thursday. Powell issued a terse “No” in response to a question about whether he would leave his Fed post before his term is up if President-elect Donald Trump asked him to. Powell later clarified that he believes Trump cannot fire him.
”Not permitted under the law,” Powell said.
Trump appointed Powell, a Republican former private equity executive who served on the central bank’s governing board, to its top spot in 2018.
President Joe Biden reappointed him to a second four-year term.
Gary Cohn, the Goldman Sachs alum who served as economic policy director during Trump’s first administration, is said to want the job, but former Trump officials have said the fact that Cohn resigned in protest over Trump’s steel tariffs makes it highly unlikely he’d get it.
Among the names mentioned by sources in touch with the Trump transition are Kevin Warsh, who served for five years on the bank’s board of governors and advised Trump during his first term; as well as Trump’s former chief economist Kevin Hassett.
In July, before Trump was elected, the Fed chair was asked whether he intended to serve out the remainder of his term, and he said, unequivocally, “Yes.”
Trump has frequently aired frustrations with Powell and occasionally threatened to remove the Fed chair from his post, which no president has ever done.
Trump has also criticized what he perceives as a lack of transparency by the Fed, which conducts its policy deliberations in private and releases the notes from those discussions weeks later. CNN has reported that Trump aides have suggested he would like real-time release of those minutes and economic reports and for the meetings to be conducted on-camera.
Trump’s fraught history with Powell
Trump and Powell clashed several times during his first term, with the president-elect threatening to fire him from the post on several occasions.
In 2018, Trump said he was considering replacing Powell with a new Fed chair after the central bank raised interest rates. A president, however, cannot easily remove a Fed chair once confirmed unless they break the law.
After markets tanked at the onset of the pandemic in March 2020, Trump told reporters he had the “right to remove (Powell) as chairman,” adding that “he has, so far, made a lot of bad decisions, in my opinion.”
More recently, Trump also said the Fed chair is among the easiest jobs in the government. “You show up to the office once a month and you say, ‘Let’s flip a coin,’ and everybody talks about you like you’re a god,” Trump said last month at an event hosted by the Economic Club of Chicago.
Trump also said his prior threats to remove Powell “because he was keeping the rates too high” caused the Fed chair to lower rates “too much.”
While the Fed chair has the most clout at Federal Open Market Committee meetings, they are not the only official to determine where interest rates should be. At every monetary policy meeting there are 11 other Fed officials who vote on interest rate moves.
CNN’s Elisabeth Buchwald contributed reporting.
