Trump plans to appoint an interim replacement for Fed's Kühlgraber within a few days
The Federal Reserve is set for a change in leadership, as President Donald Trump announced his intention to nominate a candidate within the next few days to fill the vacant position left by the departure of Adriana Kugler. Kugler's term was scheduled to expire on January 31, 2026, but she unexpectedly announced her resignation, effective this Friday.
The current search for a Fed governor is focused on finding someone to serve out the remaining months of Kugler's term, leaving the choice of a permanent replacement for a later date. Among the candidates under consideration are Stephen Miran, chair of the White House's Council of Economic Advisers, who has already been nominated by Trump to fill the seat temporarily, pending Senate confirmation.
Other potential candidates include Peter Bessent, James Bullard, and Jefferson, who are being considered for both temporary and longer-term Fed governor roles. Miran has been formally named by Trump to fill Kugler’s seat temporarily, while Bessent, Bullard, and Jefferson are under broader discussions related to Fed appointments and leadership.
Trump is weighing whether to appoint a short-term governor—likely someone already Senate-confirmed in the government, such as Miran—or someone to potentially elevate later to Fed chair. The Senate's return on September 2 may slow the confirmation process for a new Fed governor.
The Federal Reserve's Board of Governors is currently led by Chair Jerome Powell, who has been criticized by Trump for not lowering interest rates. The most recent vote on interest rates, held on July 29-30, was 9-2 in favor of leaving the policy rate unchanged, with Kugler absent.
Trump has also mentioned other potential candidates for the Fed governor position, including Scott Bessent, Howard Lutnick, JD Vance, Kevin Warsh, and Kevin Hassett. However, Bessent has stated that he is not interested in the position.
It is worth noting that Powell, unlike many of his predecessors at the Fed, does not hold a doctorate in economics, but holds a law degree and had worked as a lawyer and an investment banker in New York.
Each Fed governor and five of the 12 Fed bank presidents cast one vote on interest rates at each of eight meetings a year. With just four rate-setting meetings remaining in the unexpired portion of Kugler's term, the appointment of a new governor could have immediate implications for monetary policy.
The Senate Banking Committee, the Senate, and the full Senate all need to confirm the nominee for the Fed governor position. The first rate-setting meeting in the unexpired portion of Kugler's term is scheduled for September 16-17, which comes after the Senate's return on September 2.
The temporary nominee is expected to have roots in Wall Street, as Trump aims to appoint someone who shares his push for lower interest rates. The choice of a permanent replacement for Kugler will likely be a topic of debate and speculation in the coming months.
- The search for a new Fed governor is taking place within the context of policy-and-legislation, as the Senate needs to confirm the nominee for the position, and the Senate's return on September 2 may slow the confirmation process.
- The choice of a permanent replacement for Adriana Kugler will be a hot topic in politics and general news, as the appointment could have immediate implications for monetary policy, particularly with regards to lowering interest rates.
