Trump is weighing an unprecedented move to name a “shadow chair” of the Federal Reserve ahead of Jerome Powell’s May 2026 departure, in an attempt to pressure the central bank into steep interest rate cuts, according to CNBC. The move raises concerns about the Fed’s independence and the credibility of its future leadership, with economists warning of reputational risks for any nominee and market confusion if Trump installs an alternate monetary voice while Powell remains in office. Trump has linked rate cuts to lowering the government’s debt costs, a demand Fed leaders have consistently rejected. Analysts say naming a chair early is not uncommon, but positioning one to actively contradict Powell would destabilize investor expectations. Markets expect a rate cut in September, but Trump’s tactics could complicate the Fed’s path forward.
