Bessent: ‘Formal process’ underway to pick Powell successor

Treasury Secretary Scott Bessent on Tuesday said that the process to pick a new chairman of the Federal Reserve has started, ahead of chair Jerome Powell’s term ending in 2026 and amid growing pressure from the White House for him to step aside early.

“There’s a formal process that’s already starting,” Bessent told Bloomberg Television, referring to the steps to identify a nominee for Fed chair.

He added, “There are a lot of good candidates inside and outside the Federal Reserve.”

The secretary said that he is part of the decision-making process when asked if President Trump has asked him to serve as Fed chair.

“It’s President Trump’s decision, and it will move at his speed,” Bessent said.

Bessent, who has cemented himself as Trump’s chief dealmaker and Wall Street ambassador throughout the implementation of the tariff plan, is considered a possible replacement for Powell. There is no law preventing the Treasury secretary from also serving as chair of the Fed, experts say, but a dual role would fly in the face of the doctrine of central bank independence.

While Powell’s chair term is up in May 2026, his term as a Fed governor is up in 2028. Bessent on Tuesday suggested that Powell should also leave the board when his leadership term is done.

“Traditionally, the Fed chair also steps down as a governor,” Bessent told Bloomberg. “There’s been a lot of talk of a shadow Fed chair causing confusion in advance of his or her nomination. And I can tell you, I think it’d be very confusing for the market for a former Fed chair to stay on also.”

Trump has urged Powell to resign, following Federal Housing Finance Agency (FHFA) Director Bill Pulte calling for Congress to investigate him over past comments to lawmakers. The White House budget chief Russell Vought last week also accused Powell of mismanaging the central bank’s budget during renovations.

Trump has repeatedly bashed Powell, calling him names such as “Too Late” and “numbskull,” and he has been publicly critical of the central bank’s decision to hold interest rates steady even as inflation has cooled slightly. 

The Fed chair has defended not reducing rates as the central bank waits to see how the president’s whipsaw trade policies and tax cut plans affect a sturdy U.S. economy.