By President Donald Trump said on Thursday that he will announce his nominee to lead the Federal Reserve “next week,” underscoring his determination to reshape the central bank’s leadership after its latest decision to keep interest rates unchanged.
“We’re going to be announcing next week,” Trump said during a Cabinet meeting.
“We’re going to be announcing the head of the Fed, who that will be, and it will be a person that will, I think, do a good job.”
Trump also reiterated his expectation that the next Federal Reserve chair will move quickly to lower borrowing costs, sharpening a confrontation with the central bank that has been building for months.
Trump renews criticism after rate hold
The remarks came a day after the Federal Reserve left its benchmark interest rate unchanged at a target range of 3.5% to 3.75%, a decision that had been widely expected by markets but drew fresh criticism from the president.
“We’re paying far too much interest in the Fed,” Trump said on Thursday.
“We should have the lowest interest rate anywhere in the world. They should be two points and even three points lower.”
Trump and his allies have repeatedly argued that elevated interest rates are weighing on economic growth and putting the US at a disadvantage relative to other countries.
The president has framed rate cuts as essential to boosting investment and reducing government borrowing costs.
Escalating pressure on Fed independence
The White House’s campaign against the Federal Reserve has intensified in recent months, extending beyond public criticism of policy decisions.
Trump and his allies have backed a Justice Department investigation into the renovation of the Fed’s headquarters, a move that critics say risks undermining the central bank’s independence.
That effort has drawn warnings from economists, former policymakers and lawmakers who argue that political interference could erode confidence in the Fed’s ability to set monetary policy based on economic data rather than political considerations.
Despite the pressure, Fed officials have emphasised that policy decisions will remain guided by inflation and employment data.
Fed signals patience despite dissents
On Wednesday, the Federal Open Market Committee voted to keep rates steady, citing signs of continued economic growth and a stabilising labour market.
In its post-meeting statement, the committee said “economic activity has been expanding at a solid pace” and that the unemployment rate “has shown some signs of stabilisation.”
At the same time, policymakers reiterated that inflation remains above the Fed’s 2% target, a key reason for maintaining a cautious stance.
Federal Reserve Chair Jerome Powell reinforced that message in his remarks, saying inflation is still “well above” the central bank’s goal and that officials need to proceed carefully.
Two Fed governors, Stephen Miran and Christopher Waller, dissented from the decision, voting instead for a 25 basis-point rate cut.
Their dissents highlighted internal debate but did not alter the broader signal of patience from the committee.
Financial markets reacted modestly to the Fed’s decision, with futures pricing indicating little expectation of near-term easing.
According to the CME FedWatch Tool, traders continue to price in two quarter-point rate cuts by the end of 2026, but see limited likelihood of cuts in the coming months.
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