President-elect Donald Trump is likely to allow Federal Reserve Chair Jerome Powell to complete his term, set to expire in May 2026, according to an anonymous senior adviser within Trump’s team. Although Trump has frequently expressed frustration with Powell in the past, particularly over interest rate policies, his current stance—and that of his economic team—is to keep Powell at the helm as the Fed continues its trajectory of rate cuts.

Powell’s Position and Job Security Questions

During his recent post-election press conference, Powell faced questions about his job security under the incoming administration. Powell stated firmly that he would not leave his position prematurely, asserting that a president cannot legally remove the Fed chair without cause. “Not permitted under the law,” he added, underscoring the Fed’s independence.

Trump’s Complicated Relationship with Powell

Trump originally appointed Powell, a Republican and former private equity executive, to the top Fed role in 2018, only for President Joe Biden to reappoint him in 2021. Over time, however, Trump’s relationship with Powell became contentious, marked by frequent criticism over Powell’s handling of interest rates. In 2018, when the Fed raised rates, Trump openly considered replacing Powell, though he was legally constrained from doing so.

During the economic turbulence of early 2020, Trump voiced his dissatisfaction even more strongly, saying that Powell had made “a lot of bad decisions” that he believed hurt economic recovery. Despite the friction, Powell held firm to his policy approach, and the Fed’s role in managing interest rates and stabilizing the economy remained steady under his leadership.

Prospective Candidates for the Fed Role

Should Trump reconsider retaining Powell, several names have been floated as potential replacements. Gary Cohn, former economic policy director under Trump, is interested in the position but is unlikely to be selected due to his past resignation over Trump’s trade policies. Other possible contenders include Kevin Warsh, a former Fed governor and advisor to Trump, as well as Kevin Hassett, Trump’s previous chief economist.

Trump’s Vision for Fed Transparency

Beyond personnel choices, Trump has expressed interest in increasing the Fed’s transparency. According to sources, he is considering changes such as the real-time release of meeting minutes and economic data, along with broadcasting the Fed’s meetings publicly. This reflects Trump’s longstanding belief that the Fed’s policy decisions should be more accessible to the public.

Looking Ahead: A New Chapter in Fed-White House Dynamics?

Trump’s history with Powell and the Fed underscores a complex dynamic that may influence monetary policy over the next two years. Powell’s commitment to completing his term suggests he intends to uphold the Fed’s independence regardless of external pressures. However, Trump’s ongoing interest in influencing Fed transparency and rate policy could lead to significant shifts in how the Fed communicates and operates.