U.S. Treasury Secretary Scott Bessent didn’t shy away from talking about Federal Reserve politics and an ongoing fiscal power shift during a recent interview on FOX Business’ “Kudlow.”
“The important thing to remember is, we have two seats. So, there’s the seat for the chair, and then there will be another appointee joining, so we actually get two appointments and President Trump will have a majority of the board in D.C.,” Bessent said on Tuesday.
“It’s going to change the composition of the Fed,” he added, “it is going to change the narrative.”
On the same day, President Donald Trump told reporters at the White House that he will decide on a nominee for the Fed’s Board of Governors by the end of the week, all while the president searches for Chairman Jerome Powell’s replacement before Powell leaves his post next May.
MARKETS NOW BETTING FED WILL CUT RATES IN SEPTEMBER AFTER DISAPPOINTING JOBS REPORT
The next board nominee is also likely to be a top contender for the soon-to-be-open chair position.
Bessent said he recommended Stephen Miran, current chairman of the White House National Economic Advisory Committee, as he’s “thoughtful, methodical, and has a lot to say about the Fed.”
“I think that his appointment,” Kudlow reacted, “I believe sincerely makes Jay Powell a lame duck… [Miran’s] a smart chap, he was your guy for CEA, now you’re putting him on the Fed. I think it changes everything, and I think it does make Powell a lame duck.”
“Well, look,” Bessent started to respond. “We’ve seen with these big economic revisions, and I’m sure we’ll come back and talk about poor quality of data because if we’d had the original numbers, the Fed could have been cutting in June, July. So I think the real thing now to think about is, should we get a 50 basis point rate cut in September to make up for the delay and the lack of data?”
Trump on Tuesday also ramped up his pressure on Powell to cut interest rates, threatening to allow a lawsuit over the central bank’s $3.1 billion renovation project to move forward.
Trump took to Truth Social to blast Powell, who has refused to adjust rates despite repeated demands by the president as inflation remains steady, holding at 2.7% in July.
“Jerome ‘Too Late’ Powell must NOW lower the rate,” Trump wrote.
Bessent assured that Trump has “a very open mind” when it comes to who will soon lead the central bank.
“He even considered reappointing Janet Yellen. So, we want to see what everyone’s thinking,” Bessent said. “It’s not ideological, it’s about economics, what’s best for the American people, what’s best for the economy.”
“And as I talk to the candidates, I’m looking at three things: monetary policy, regulatory policy and ability to run and revamp the organization. Because it’s really gotten bloated, and I think that this bloat puts its monetary independence at risk.”
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Fox News’ Michael Dorgan contributed to this report.
