Following a recent U.S. Supreme Court ruling that blocked President Donald Trump’s attempt to dismiss Federal Reserve Board member Lisa Cook, the Trump administration is reportedly making renewed efforts to assert control over the Fed, according to Bloomberg News, citing sources. This raises the possibility that the administration may intensify its calls for interest rate cuts.
According to reports, senior officials in the Trump administration are actively seeking ways to appoint more of the president’s preferred candidates to the Fed board. Sources indicate that both Cook and former Fed Chair Jerome Powell are among the primary targets for replacement.
Powell, who has been at odds with Trump over interest rate cuts, saw his term as Fed chair expire in May but remains a board member until January 2028. Cook was announced to be dismissed last August after Trump accused her of committing fraud in the mortgage lending process. However, on June 29, the Supreme Court ruled 5-4 that Cook could retain her position while the lawsuit is ongoing.
Despite the Supreme Court reaffirming the Fed's independence, Trump’s allies are reportedly preparing to push for Cook’s removal, noting the narrow 5-4 ruling and the limited scope of the decision. Trump himself expressed intentions to dismiss Cook in an interview with CNBC, stating, "We will begin that process (of removing Cook). We will do it perfectly."
Additionally, some of Trump’s close associates have indicated his dissatisfaction with Powell remaining on the board after stepping down as chair. Kevin Hassett, the White House National Economic Council Chair and Trump’s economic advisor, expressed concerns on Fox Business this week, stating, "Jay (Jerome) Powell remaining is worrisome. There are people at the Fed who vote (on rates) not for the country but to check Trump. We need to watch this closely."
Meanwhile, the Trump administration is reportedly looking for candidates to fill the vacant presidency of the Atlanta Federal Reserve Bank, which has been open since the resignation of Raphael Bostic in February. The Atlanta Fed, which tracks real-time U.S. economic growth through its GDPNow indicator, is a position closely monitored by Trump’s economic team. The Atlanta Fed president will also be one of the 12 voting members on interest rate decisions next year, making this role significantly influential in monetary policy.
Trump has consistently advocated for interest rate cuts since his re-election last year, clashing with Powell, who had previously expressed caution about rate cuts amid inflation concerns.
Kevin Warsh, the new Fed chair who took office in May, initially agreed with Trump’s call for low rates but has recently raised concerns about inflation due to rising oil prices from the ongoing Middle East conflict.
As the Trump administration seeks to recover public sentiment ahead of the November midterm elections, there is speculation that it may ramp up pressure for interest rate cuts. Recent agreements between the U.S. and Iran have led to a significant drop in oil prices, and disappointing U.S. employment figures released this week have eased some pressure for rate hikes and reduced concerns about rate cuts. According to the CME FedWatch Tool, the likelihood of a 0.25 percentage point rate hike at the upcoming Federal Open Market Committee meeting has dropped from over 30% a week ago to 17.6% now.
Last week, at a White House event, Trump reiterated, "We need low interest rates. Low rates will solve everything."
* This article has been translated by AI.
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