Trump Considers Replacing Fed Chair Jerome Powell; Kevin Warsh Named Frontrunner

President Trump is reportedly weighing a move to remove Federal Reserve Chair Jerome Powell before his current term concludes in May 2026. According to sources close to the administration, former Federal Reserve Governor Kevin Warsh has emerged as the leading candidate to replace Powell should the administration decide to pursue a change at the central bank’s helm.

Kevin Warsh: Background and Alignment with Trump

Kevin Warsh, who served as a governor of the Federal Reserve during the 2008 financial crisis under Chairman Ben Bernanke, is identified by insiders as the top contender. Warsh has publicly criticized the Fed at times, suggesting the institution can be influenced by political considerations — a perspective that reportedly resonates with President Trump. His experience during the financial crisis and his private sector background have contributed to his visibility as a potential appointee.

Other Names Under Consideration

Beyond Warsh, the administration is said to be weighing several other figures for the Fed chair role. Those mentioned include Kevin Hassett, Art Laffer, Larry Kudlow, and Federal Reserve Governor Chris Waller. Each candidate brings a distinct economic perspective and policy track record. For instance, Governor Chris Waller has signaled support for interest rate cuts as a means to stave off a potential recession — a position he ties in part to the broader economic environment, including the impact of elevated tariffs.

Political Calculations and Odds

Steve Moore, an advisor to President Trump, has described the odds of an early removal of Powell as “a little less than 50-50,” reflecting the uncertainty and high stakes surrounding any move to change Federal Reserve leadership before a term ends. Replacing a sitting Fed chair midterm would be an uncommon and politically charged action, with potential implications for markets, monetary policy continuity, and the administration’s broader economic agenda.

Dissent Within the Administration

Not everyone in or around the administration supports the idea of an early replacement. Treasury Secretary Scott Bessent has reportedly voiced opposition to removing Powell before his term ends, arguing that the integrity and stability of Fed monetary policy must be safeguarded. In his remarks, he described Fed policy as “a jewel box that’s got to be preserved,” underscoring concerns that abrupt leadership changes could unsettle financial markets and undermine confidence in the central bank’s independence.

Implications for Monetary Policy and Markets

The potential for a leadership change at the Federal Reserve raises questions about the future direction of U.S. monetary policy. A new chair with different priorities or philosophical leanings could influence decisions on interest rates, balance sheet policy, and the Fed’s response to inflation or economic slowdown. Market participants typically watch leadership signals closely, and speculation about a midterm replacement can itself affect investor sentiment and financial conditions.

What to Watch Next

• Statements from the White House and the Federal Reserve clarifying any intentions or plans.
• Public comments or further disclosures from the named candidates, including Kevin Warsh, Kevin Hassett, Art Laffer, Larry Kudlow, and Governor Chris Waller.
• Reactions from market participants and economic commentators to any credible reports of an impending change.
• Policy signals from the Fed that could be interpreted as continuity or a prelude to change.

As this situation develops, both policymakers and market observers are likely to scrutinize any moves closely. Replacing a Federal Reserve Chair midterm would be a rare and consequential step, with ramifications for economic policy, institutional credibility, and financial markets.