What's happened
President Trump is actively interviewing four final candidates to replace Fed Chair Jerome Powell, focusing on economic stability and interest rate policies. Waller, Hassett, Warsh, and Rieder are under consideration, with recent discussions emphasizing labor market health and rate management.
What's behind the headline?
Trump's focus on selecting a Fed chair aligned with his interest rate goals indicates a strategic attempt to influence monetary policy directly. Waller's recent interview and public support for lower rates suggest he is a strong contender, especially given his prior nomination and alignment with Trump's views. The consideration of Rieder signals a potential shift towards a candidate with a market-oriented background, though concerns about independence persist. The broader context reveals Trump's desire to reshape the Fed to facilitate lower borrowing costs, which could impact inflation and financial stability. The ongoing tension between market expectations and political influence underscores the risk of politicizing the central bank, potentially undermining its credibility and independence in the long term.
What the papers say
The New York Times highlights Trump's long-standing desire for a more malleable Fed chair, emphasizing his focus on lower interest rates and his dissatisfaction with Powell's cautious approach. The NY Post reports that Trump is actively interviewing candidates, with Waller and Rieder as finalists, and notes concerns from financial leaders about Hassett's close ties to the White House potentially affecting market stability. The Guardian underscores Trump's public assertions that he should be listened to by the Fed, revealing his overt attempts to sway the appointment process. CNBC provides insights into Waller's recent comments on interest rate cuts and labor market concerns, illustrating his alignment with Trump's rate-lowering agenda. Overall, the coverage reflects a narrative of political influence over monetary policy, with varying perspectives on the potential consequences for market independence and economic stability.
How we got here
Trump has been seeking a Fed chair who will lower interest rates to support his economic agenda. His previous preference for Scott Bessent was declined, leading to a shortlist including Kevin Hassett, Kevin Warsh, Rick Rieder, and Christopher Waller. The decision reflects his desire for a more rate-friendly central bank amid ongoing inflation concerns.
Go deeper
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Donald John Trump is an American politician, media personality, and businessman who served as the 45th president of the United States from 2017 to 2021.
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