Will Trump replace Powell as Fed Chair?

Will Trump replace Powell as Fed Chair?

Trump has openly criticized the Fed and could replace Jerome Powell if re-elected, potentially before Powell’s term ends in May 2026. A Trump-aligned Fed chair would likely push for lower interest rates, which could strengthen the dollar while pressuring U.S. stocks.

The Federal Reserve has kept interest rates unchanged in its first meeting of the year, but markets are watching for Donald Trump’s response.

Last week, Trump demanded the Fed lower interest rates and talked about how he was more qualified to set interest rates for the country. While he has no direct authority over rate decisions, he does have the power to nominate board members, including the Fed Chair.

With Jerome Powell’s term expiring in May 2026, markets are already speculating on whether he would move to replace him — possibly even before his term ends. Trump’s petulance shouldn’t be underestimated. A leadership change at the Fed could have significant implications for markets, with a Trump-aligned chair likely to push for lower rates, potentially weakening the dollar while strengthening U.S. equities.