Bessent an option to replace Fed chair, ‘but I like the job he’s doing’, says Trump
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US Treasury Secretary Scott Bessent (above) said a “formal process” was already starting to identify a potential successor to current Federal Reserve chairman Jerome Powell.
PHOTO: AFP
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WASHINGTON - US President Donald Trump said on July 15 that Treasury Secretary Scott Bessent could be a candidate to replace Federal Reserve chairman Jerome Powell, but suggested that might not happen.
After landing at Joint Base Andrews following a trip to Pittsburgh, Mr Trump was asked if Mr Bessent could be a possible replacement for Mr Powell, whose term ends in May 2026.
“He’s an option, and he’s very good. Well, he’s not, because I like the job he’s doing, right?“ Mr Trump told reporters.
The President has railed against Mr Powell in recent months for not lowering US interest rates, and has repeatedly urged him to resign
On July 15, Mr Trump said cost overruns on a US$2.5 billion (S$3.2 billion) renovation of the Fed’s historic Washington headquarters could amount to a firing offence.
“I think it sort of is,” he added, when asked if he could fire the Fed chair over the renovation cost overruns, which have been sharply criticised by Trump administration officials.
The President cannot fire Mr Powell over a monetary policy dispute.
Mr Trump had originally appointed Mr Powell, a fellow Republican, during his first time in office, and Mr Powell was reappointed for a second term as Fed chief by Democratic President Joe Biden.
With the unemployment rate low and inflation above the Fed’s 2 per cent target, US central bank officials have been reluctant to cut interest rates from the current 4.25 per cent to 4.5 per cent range until it is clear that Mr Trump’s tariff policies will not lead to a fresh surge in prices.
US data on July 15 showed that consumer prices rose across an array of goods, from coffee to audio equipment to home furnishings, in what economists say is evidence that the increasing import duties are being passed on to consumers.
Overall consumer prices rose 0.3 per cent in June – a roughly 3.5 per cent annual rate – after a 0.1 per cent increase in May.
Other people under consideration to replace Mr Powell include former Fed governor Kevin Warsh and Mr Trump’s top economic adviser Kevin Hassett.
Mr Bessent, who has also played a key role in Mr Trump’s trade negotiations with a host of countries, told Bloomberg Surveillance on July 15 that a “formal process” was already starting to identify a potential successor to Mr Powell.
“There are a lot of great candidates, and we’ll see how rapidly it progresses,” Mr Bessent said.
He said it would be confusing for Mr Powell to remain at the Fed after his term as chair ends in May 2026. Mr Powell’s term as Fed governor extends until Jan 31, 2028.
Trump administration officials argue that a tax Bill nearing passage in Congress will boost private-sector investment and strengthen the US economy. They insist that while tariff increases could result in a one-time bump in prices, they should not drive up inflation over the longer term. REUTERS
