Trump Says Bessent Declined Fed Chair Nomination

Michael McKee, Bloomberg International Economics and Policy Correspondent, discusses who is in the running for the next Fed Chair.

President Donald Trump said Treasury Secretary Scott Bessent told him he didn’t want to be nominated to replace Jerome Powell as the next chair of the Federal Reserve.

“I asked him just last night, is this something you want?” Trump said Tuesday in an interview with CNBC. Bessent’s response was, “Nope, I want to stay where I am,” he said.

“He’s doing a great job, and he wants to do what he’s doing, so I just take him off. He does not want it,” Trump continued. “He likes being Treasury secretary. He’s doing a really good job.”

Trump said he was considering four candidates — including former Federal Reserve Governor Kevin Warsh and National Economic Council Director Kevin Hassett — for the post, but cautioned he didn’t intend to make the decision soon.

“I think I say Kevin and Kevin, both Kevins are very good, and there are other people that are very good too,” Trump said.

Immediate Opening

On Friday, Adriana Kugler announced that she would vacate her Fed Board of Governors seat, which was not due to expire until January, giving Trump an earlier opportunity than expected to shape the central bank’s interest-rate-setting policies by picking a replacement who aligns with his preference for lower borrowing costs.

The president has exerted intense pressure on the Fed in his demand for lower interest rates, using social media to attack Powell. Trump on Friday called for Powell to resign and at times he’s mulled whether he should fire him or just wait out his term. Powell is scheduled to step down as chair in May, though his separate term as a Fed board member runs until January 2028.

Trump has previously said he has a “couple of people in mind” for Kugler’s post and the president’s nominee for the open governor’s spot could also move into the role of chair when Powell’s term is up.

Trump has repeatedly blamed the central bank and Powell for being too slow to lower interest rates and misreading inflation. Trump has argued the central bank — which has so far left rates unchanged in 2025 — is keeping the federal government’s debt-servicing costs too high and restraining economic growth.

Labor Data

Last week, Powell didn’t offer any clear sign that policymakers were likely to cut at their next meeting, in September, but market expectations moved after that meeting.

New jobs numbers on Friday showed a labor market that was cooling dramatically, with payroll gains of 73,000 in July after the prior two months were revised down by nearly 260,000. In the last three months, employment growth has averaged 35,000. Money markets have now priced in two rate cuts this year, with a 90% chance of a reduction in September.

Hours after the release of that jobs report on Friday, Trump fired BLS chief Erika McEntarfer.

The president accused McEntarfer, without evidence, of political bias, pointing to the downward revisions for May and June and other large revisions ahead of last year’s election as favoring Democrats. The firing stunned Washington and Wall Street and spurred questions about how the president’s move would impact the integrity of a bureau whose data is critical to global investors.

‘Rigged’ Claim

Trump reiterated those claims that the numbers were “rigged” on Tuesday, despite CNBC hosts noting former administration officials who said that the commissioner was not involved in the minutiae of the data and that revisions were standard practice. William Beach, who was appointed to head the BLS during Trump’s first term, has called McEntarfer’s firing “totally groundless,” saying it created a “dangerous precedent.”

“It’s a highly political situation. It’s totally rigged. Smart people know it. People with common sense know it,” Trump said.

Hassett has argued the revisions require better explanations and said that the data bureau could use a “fresh set of eyes” and modernize its labor data collection to be more transparent.

Trump said the process was “antiquated, but it’s also very political.”

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