"President Trump's plans for a more receptive Fed may have backfired so spectacularly that Jerome Powell may end up staying as chairman beyond the end of his term, while Stephen Miran, Trump's most loyal supporter on the bank's rate-setting committee, leaves the institution. Trump has repeatedly taken aim at the chairman of the U.S. Federal Reserve-often via personal insults-since launching his presidential bid. First, he wanted Powell to hold interest rates higher to avoid boosting President Biden's ratings on the economy."
"After he won the Oval Office, he began lobbying for lower rates and has gone to unusual lengths to shape monetary policy, including multiple legal threats.Last week, he achieved a key aim: Finding a replacement for Powell (whose term as Fed chairman ends in May) who is suitably dovish, but isn't seen as so close to the White House that it would spook markets."
President Trump shifted from pressuring the Fed for higher rates to lobbying for lower rates after taking office, using personal attacks and legal threats to influence monetary policy. A nomination of Kevin Warsh as a replacement for Jerome Powell achieved the aim of finding a dovish candidate who appears market-safe. Warsh's confirmation faces delay because Senate Banking Committee Democrats refuse to hold hearings until criminal proceedings against Fed members are dropped. Two FOMC members, Jerome Powell and Lisa Cook, face court action, and the Supreme Court blocked an attempt to remove Cook.
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