Bessent will interview 11 candidates to replace Powell at Fed

Treasury Secretary Scott Bessent said Tuesday he plans to interview nearly a dozen “very strong" candidates to replace Jerome Powell as chair of the Federal Reserve.

Mr. Bessent said he will begin vetting 11 candidates in September as President Trump tussles with the central bank over interest rates and looks toward the expiration of Mr. Powell’s term in May.

“I'm going to be meeting with them probably right before or right after Labor Day and to start bringing down the list to present to President Trump,” Mr. Bessent told CNBC’s “Squawk Box.” 

“It's an incredible group. It's people who are at the Fed now, have been at the Fed and private sector,” he said. “So I'm looking forward to meeting all of them with a very open mind.”

Mr. Bessent did not disclose names, though some have been bandied about, including Fed Governors Michelle Bowman and Christopher Waller, and former Fed Governor Kevin Warsh, Dallas Fed President Lorie Logan and White House National Economic Council Director Kevin Hassett.

Mr. Trump is furious with Mr. Powell over the Fed’s reluctance to reduce interest rates. The central bank is worried about potential inflation from Mr. Trump’s tariff policies, which were in flux for most of the year.

The White House says earlier tariffs did not spark systemic inflation, and that Fed inaction is forcing U.S. borrowers to swallow lousy terms and hurting economic growth.

Inflation remains above the Fed’s target rate of 2%, and central bankers remain leery about tariff-driven price increases. But a slowing jobs market could result in a rate cut at the Fed’s meeting in September.

Employers added a weaker-than-expected 75,000 jobs in July. Also, the Bureau of Labor Statistics revised its May and June totals, concluding the country added 258,000 fewer jobs than initially thought.

Many forecasters are expecting a rate cut of 25 basis points, or 0.25%.

Mr. Powell will address Fed policymakers at an annual symposium in Jackson Hole, Wyoming, on Friday. His remarks could provide clues about which way the Fed is leaning.

Mr. Bessent said high rates are constraining home-building, which will cause prices to soar.

“A cut here could facilitate a boom, or a pickup in home building, which will keep prices down one, two years down the road,” Mr. Bessent said.

Mr. Trump’s constant complaints about Mr. Powell stirred worries that he would move to fire the chair, who is supposed to act independently of political pressure.

The president says he is not interested in firing Mr. Powell, though he is making life difficult for him.

Mr. Trump calls Mr. Powell harsh nicknames, dubbing him a “major loser” who is always “too late” in his rate decisions.  At one point, Mr. Trump said he was considering a lawsuit over the cost of a renovation project at the Fed building in Washington.

Mr. Powell has brushed off the criticism, saying he is focused on the Fed’s twin mandate of stable prices and maximum employment.