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4h ago

Trump Touts Warsh and Hassett for Fed Chair as Push for Lower Rates Intensifies

Fed policymakers remain split on future cuts, with Powell citing a possible payroll overcount that clouds the labor picture.

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Michelle Bowman, vice chair for supervision at the Federal Reserve; Fed Chair Jerome Powell; Governor Lisa Cook; and then-Governor Adriana Kugler, left to right, during the Federal Reserve Board open meeting in Washington, DC, on June 25.
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Overview

  • The FOMC delivered a third straight 25-basis-point cut to 3.50%–3.75% in a 9-3 vote, the most dissents since 2019.
  • Chicago Fed’s Austan Goolsbee and Kansas City Fed’s Jeffrey Schmid said they preferred holding rates to assess inflation, while Governor Stephen Miran favored a larger, 50-basis-point reduction.
  • President Trump said he wants the next chair to consult with him and pushed for rates near 1%, naming Kevin Warsh and Kevin Hassett as leading candidates.
  • Powell said BLS methods likely overstated payrolls by roughly 60,000 a month since spring, suggesting recent job growth may be weaker than headline figures.
  • Markets are pricing more easing than the Fed’s projections, Treasury yields ticked higher as investors reassessed the path for 2026, and recent data delays have added uncertainty to policymaking.