On Friday, a member of the Federal Reserve’s Board of Governors revealed that she’s resigning a few months before her term is officially up. This opens the door for President Donald Trump to make an important appointment.
Adriana Kugler, the Fed Governor, is leaving her position effective August 8. She was appointed by former President Joe Biden back in 2023, with her term initially set to run until January 2026.
The central bank hasn’t disclosed any specific reasons for her departure.
Kugler expressed her gratitude in a statement: “Serving on the Board of Governors of the Federal Reserve System has been an extraordinary honor. I’m especially grateful to have contributed during this crucial period aimed at stabilizing prices and maintaining a strong labor market.”
Rumors suggested that she resigned due to disagreements over interest rates, a claim Trump made to the press on Friday.
He stated, “I’ve heard that her resignation was related to her disagreement with someone in her party about interest rates…she didn’t see eye to eye with ‘Too Late’ regarding the current rates.” This term ‘Too Late’ refers to Fed Chair Jerome Powell, as Trump has been pushing for reductions in interest rates. So far, the Fed has kept rates unchanged this year.
Trump didn’t provide any proof to support his statement.
However, he expressed satisfaction with the vacancy. He leveraged Kugler’s resignation to additionally pressure Powell on social media.
“‘Too Late’ Powell should resign just like Adriana Kugler did. A Biden Appointee recognized he was making poor decisions on interest rates. He should step down too!” Trump shared on Truth Social.
Kugler was not present at the Fed’s recent meeting where officials voted to keep borrowing costs steady for the fifth consecutive time.
Trump has been vocal against the Fed lately, criticizing them for not lowering interest rates this year. Now, with Kugler’s resignation, he has the chance to appoint a fresh face at a time when the Fed seems unusually split.
Anyone Trump selects will be a contender for the next Fed chair role, if they receive Senate confirmation to join the Fed’s board. According to regulations, the Fed chair must be chosen from among the board’s current members.
Treasury Secretary Scott Bessent indicated that they are actively looking for Powell’s successor.
Possible candidates for the top job at the Fed include Bessent, former Fed governor Kevin Warsh, current Fed governor Christopher Waller, and Kevin Hassett, who leads the White House’s National Economic Council.
Despite Powell’s term as chair ending next year, he could stay on the board, which narrows Trump’s options for a new chair to existing board members.
Fed chairs hold three key roles: member of the Fed’s Board, chair of the Board of Governors, and chair of the Federal Open Market Committee (FOMC)—the group that sets interest rates, elected from among the committee leaders.
Legally, it’s uncertain whether Trump can demote Powell and promote另一位 governor as chair.
Powell’s term runs until 2028. After announcing the Fed’s recent decisions, Powell declined to comment on whether he intends to remain on the board once his chair position concludes.
Reporting contributed by CNN’s Kit Maher.
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