President Donald Trump said on Jan. 29 that he would announce his pick to lead the Federal Reserve on Friday.
He moved up his planned announcement after saying earlier in the day that he would reveal his pick to succeed Jerome Powell as chair of the Federal Reserve next week.
He also criticized Powell for not lowering interest rates enough.
"We're paying far too much interest," Trump said. "The Fed rates are too high—unacceptably high. We should have the lowest interest rate anywhere in the world."
The president has said he thinks that the benchmark federal funds rate—a key policy rate that affects business and household borrowing costs—should be 2 to 3 percentage points lower.
“Each point is the equivalent of, I would say, $500 billion, so if you got 2 points at all, you have a trillion dollars in savings,” he said.
Although economic growth remains firmly intact, the administration has said that conditions could be even better if the Fed were to loosen monetary policy.
"We want help, not hindrance—why would the Fed hinder?" Trump said.
"But with the help of the Fed, we could hit numbers that have never been hit before."
Fed Policy on Hold
Trump's remarks come one day after the Fed left interest rates unchanged at its first meeting of 2026. Investors anticipate that the first rate change will happen in June, according to futures market data.As to who is expected to be Powell's successor, prediction markets are giving BlackRock executive Rick Rieder an edge.
National Economic Council Director Kevin Hassett and Fed board member Christopher Waller have slipped in expectations.
Despite Trump insisting that interest rates need to be a lot lower, Rieder has indicated a more cautious approach to easing monetary policy.
In his speech at the World Economic Forum in Davos, Switzerland, Trump quipped about the difficulty of finding a new central bank chief, suggesting that chairmen change once they receive the four-year term.
“They get the job, they’re locked in for six years," Trump said. "They get the job and all of a sudden, ‘Let’s raise rates a little bit.' It’s amazing how people change once they have the job. It’s too bad. It’s sort of disloyalty. But they’ve got to do what they think is right.”
A top talking point among economic observers is the state of the Federal Reserve’s independence when a new individual heads the central bank.
All the leading contenders have championed monetary independence, arguing that it is paramount for the broader economy and to ensure that the Fed is not a political institution.
During a post-meeting news conference, Powell emphasized the need for central bank independence and the importance of his successor refraining from involvement in elected politics.
"It's just an institutional arrangement that has served the people well—to not have direct elected official control over the setting of monetary policy," he said.
“We haven’t lost it. I don’t believe we will. I certainly hope we won’t."
Despite the White House and Fed candidates endorsing independence, Trump’s pick will face intense scrutiny among Wall Street investors.
"Looking ahead over this year, Fed independence and credibility could become a bigger driver for markets," Ali Hassan, portfolio manager at Thornburg Investment Management, said in a note emailed to The Epoch Times.
"Key flashpoints: Trump jawboning, [Department of Justice] probe involving Powell, [Fed board member Lisa] Cook removal fight, chair succession.”
The next two-day Federal Open Market Committee meeting will take place on March 17 and March 18.