Trump Criticizes Fed Chair Powell, Weighs Early Replacement to Influence Rate Policy

Federal Reserve Chair Jerome Powell faced sharp public criticism this week from President Donald Trump, who called him “very stupid” and hinted at naming a successor before Powell’s chair term expires in 2026. Trump confirmed he’s narrowed his list to three or four potential picks, including names like Kevin Warsh, Scott Bessent, and Christopher Waller. The possibility of a “shadow chair” has sparked a market reaction, with increased bets on rate cuts and a drop in Treasury yields and the dollar. Analysts warn an early replacement could harm the Fed’s independence. While Powell testified before Congress without incident, Trump’s remarks and actions could signal an effort to influence monetary policy ahead of the election. The Fed recently eased some bank regulations and remains under political scrutiny.