Fed Vacancy Gives Trump Chance to Disrupt Fed

President Trump erupted on social media after the Federal Reserve held interest rates steady this week, calling on the board to “assume control” and lower rates on the same day a Biden-appointed Fed governor announced her resignation.

Kugler's resignation gives President Trump the chance to expand his influence over the central bank just as he pushes for a revolt against Powell. (Photo: Federalreserve Flickr)

Experts say Trump’s interpretation of the interest rate decision is misguided, and a revolt against Chair Jerome Powell is unlikely, Marco Quiroz-Gutierrez reported for Fortune.

Fed Governor Adriana Kugler announced last week that she is stepping down from her position earlier than expected, giving President Trump the chance to expand his influence over the central bank just as he pushes for a revolt against Powell.

In a post on Truth Social before Kugler’s announcement, Trump took a jab at Powell, saying he must “substantially” lower interest rates, after the Federal Open Market Committee (FOMC) voted overwhelmingly to keep rates unchanged.

Kugler’s departure gives Trump a key opportunity to nominate a voting member to the FOMC and increase his sway. The FOMC sets the federal funds rate, which Trump insists must come down.

The committee consists of the seven Fed board governors, the New York Fed president, and four rotating regional Federal Reserve bank presidents.

This week’s FOMC meeting kept rates steady between 4.25% and 4.5%, with two Trump-appointed governors—Michelle Bowman and Christopher Waller—dissenting.

It was a rare break from what is usually a unanimous vote, but far from a mutiny, said Michael Ashley Schulman, chief investment officer of Running Point Capital Advisors.