Report: Trump advisors push for temporary filling of the vacancy on the Federal Reserve Board

On Wednesday, according to media reports, Trump's advisors are pushing to temporarily "fill the vacancy of Federal Reserve Governor" and are suggesting he nominate an interim Federal Reserve Governor to fill the upcoming vacancy on the board.

Nominating an interim governor to complete the term of the soon-to-be-vacant seat (which will expire in January 2026) could buy Trump more time to select a suitable candidate to replace current Federal Reserve Chairman Jerome Powell, whose term will end in May next year. Current Federal Reserve Governor Adriana Kugler announced last week that she will leave on August 8.

Media sources cited informed individuals stating that the short-term interim governor candidate is likely to come from existing members of the Trump administration and has previously received Senate confirmation for a federal position. The nominee still needs to be confirmed by the Senate, which typically takes months, but if Trump pressures Congress to fill the position quickly, the process could be expedited.

Trump plans to hold a meeting with his advisors on Wednesday regarding the Federal Reserve candidates.

Trump previously stated on Tuesday that he would decide this week who will replace Kugler. A White House official indicated that any decision should not be viewed as final until Trump makes an official announcement.

During an event at the White House on Tuesday, Trump mentioned he is weighing whether to nominate a short-term candidate or a candidate with clear prospects who may eventually succeed as Federal Reserve Chairman:

"We either choose a long-term appointment or someone for a few months. You know, this position has only a few months left in its term."

Kugler's early departure gives Trump an opportunity to appoint a Federal Reserve governor who aligns more with his preferences and supports low-interest rate policies sooner than expected.

Trump has been highly critical of the Federal Reserve, repeatedly accusing the institution and Powell of being slow to cut interest rates. He believes that the Federal Reserve's decision to maintain interest rates unchanged so far in 2025 has kept the federal government's debt financing costs high, suppressing economic growth.

However, analysts point out that even if the Federal Open Market Committee (FOMC) adds a dovish governor, it is unlikely to immediately change the policy direction. The FOMC consists of 7 Federal Reserve governors and 5 rotating members from the 12 regional Federal Reserve Bank presidents, and any interest rate adjustment requires a majority vote.

Among the 19 policymakers participating in FOMC meetings, most indicated in June that they expect two rate cuts this year, making a rate cut in September a highly likely option.

In the July meeting, two Federal Reserve governors, Christopher Waller and Michelle Bowman, voted against maintaining interest rates unchanged, marking the first time since 1993 that two governors opposed the interest rate decision. Both were appointed by Trump.

Trump also stated on Tuesday that he is considering four candidates for Federal Reserve Chairman, including former Federal Reserve Governor Kevin Warsh and Director of the National Economic Council Kevin Hassett. He also revealed that U.S. Treasury Secretary Scott Bessent has explicitly stated he does not wish to compete:

We are considering candidates for the Federal Reserve Chair, and we have narrowed it down to four. I can tell you the names because I have already mentioned them—two Kevins and two others