President Donald Trump’s decision to temporarily fill a vacant seat at the Federal Reserve gives him two gifts in one: an ally at the central bank to push his agenda, and a little more time to decide the bigger prize, who gets to run the Fed next.
On Thursday, Trump announced he would nominate Stephen Miran, current head of the White House Council of Economic Advisers, to serve on the Fed’s Board of Governors in a term expiring this coming January.
“In the meantime, we’ll continue looking for a permanent replacement,” Trump said — as if this were just an inconvenient staff reshuffle rather than the prelude to a potential political storm at the world’s most influential central bank.
That “permanent replacement” would serve a full 14-year term as governor and could easily be elevated to replace Jerome Powell when his chairmanship ends in May. Powell, for his part, has been studiously coy about whether he will step down, and could legally remain as governor until 2028.
Since only sitting governors can be appointed Fed Chair, Miran’s seat, conveniently expiring in January, is Trump’s short-term opening to plant a loyalist in the top job. It doesn’t stop him from choosing an existing governor, of course, and Christopher Waller now tops the bookmakers’ list. Trump has also floated the names of former Fed Governor Kevin Warsh and ex-National Economic Council director Kevin Hassett.
Analysts at Evercore ISI summed it up neatly: by picking Miran now, Trump has bought himself time until January to make the “real” decision. He also gets, in Miran, a policymaker likely to support his favourite pastime: cutting interest rates.

Trump has been a relentless critic of the Fed, accusing it, and Powell personally, of dragging its feet on rate cuts. In his telling, the Fed’s refusal to slash rates in 2025 has kept federal debt servicing costs “unnecessarily high” and throttled economic growth. This sustained pressure, plus his open promise to pick a rate-cutter for the top job, raises the obvious question: is the four-decade tradition of Fed independence about to be quietly buried in favour of White House micromanagement?
Plenty of economists and investors think so, and they’re not amused. Fed independence could spark a sell-off in the dollar.
One awkward fact: one of the main reasons the Fed has been holding rates steady this year is Trump’s own trade war. His new tariffs on a broad range of U.S. trading partners are inflationary by design, a point Powell and others have repeatedly stressed, but that hasn’t stopped Trump from demanding cheaper money.
Still, dissent exists inside the Fed. Waller and Governor Michelle Bowman have already argued for a quarter-point cut in the face of weakening labour data. If Miran joins the Board, he could tilt the internal debate further towards cuts, though he’s unlikely to be seated in time for the September meeting.

Miran’s CV, Harvard PhD, pro-tariff, pro-Trump, reads like a checklist for ideological compatibility. On Bloomberg TV this week, he dutifully claimed there was “no meaningful macroeconomic evidence” that Trump’s tariffs were fuelling inflation. And if they did, he added, it would be “a one-off adjustment in price levels, not a lasting trend.”
His voice will be just one among the 12 voting members of the Federal Open Market Committee, but symbolism matters. Investors will read his nomination as a signal: the coming Fed will be friendlier to growth-at-all-costs policy, and more willing to “tolerate” inflation along the way. Unanimous decisions? Those might become another nostalgic relic.
Miran may also be the tip of the spear for a more radical Trump reshaping of the Fed. In a 2024 paper co-authored with Dan Katz, now Treasury Chief of Staff, he argued for shortening governors’ terms and making them explicitly subject to the President’s discretion. They even suggested putting the Fed’s budget under Congressional control, ending its current self-financing structure, a recipe for permanent political leverage.
Such ideas would require legislation, but the underlying theme is clear: Miran and Katz see Fed independence less as a constitutional safeguard and more as an outdated courtesy that breeds unaccountable power. History shows political control of central banks tends to end in higher inflation.

For now, the markets are watching the Fed chair sweepstakes. Evercore’s analysts say Miran’s nomination keeps the field wide open, especially for Waller, whose odds would have plummeted if Trump had immediately locked in a 14-year loyalist.
Trump’s message is as unsubtle as ever: the Fed should cut rates, live with higher inflation if it must, and fall in line with the White House’s definition of “growth-friendly” policy. Whether that’s called leadership or interference depends on where you sit, but investors might want to buckle up for a central bank whose inflation target proves a lot more flexible than its job description.