U.S. President Donald Trump said on Wednesday that his next pick to lead the Federal Reserve will strongly support significantly lower interest rates, reinforcing his long-standing push to ease borrowing costs.
“I’ll soon announce our next chairman of the Federal Reserve, someone who believes in lower interest rates — by a lot — and mortgage payments will be coming down even further,” Trump said during a national address highlighting his economic and national security record in the first year of his second term.
Trump has indicated he will name a successor to current Fed Chair Jerome Powell early next year. The leading candidates — White House economic adviser Kevin Hassett, former Fed Governor Kevin Warsh, and current Fed Governor Chris Waller — have all expressed support for lower rates than current levels. However, none has publicly endorsed cuts as deep as those Trump has previously called for, including reductions to around 1%, a level typically associated with crisis conditions.
The Federal Reserve’s benchmark rate currently stands between 3.5% and 3.75%, and even Trump’s most recent appointee, Governor Stephen Miran, has not backed cuts anywhere near that level.
While Trump has repeatedly argued that lower Fed rates would reduce mortgage costs, economists note that the central bank has limited influence over long-term borrowing rates. Mortgage rates are more closely tied to longer-dated yields, such as the 10-year U.S. Treasury, which are driven by investor expectations around growth and inflation. As a result, mortgage rates have remained largely unchanged, hovering between 6.3% and 6.4% since Labor Day.
Trump told The Wall Street Journal last week that he is leaning toward either Warsh or Hassett for the role, though interviews continued on Wednesday, including a meeting with Waller, who has supported lower rates while firmly defending Federal Reserve independence.
The president also suggested the next Fed chair should consult with him on rate decisions — a departure from modern norms. “It doesn’t mean he should do exactly what we say,” Trump said, “but **I’m a smart voice and should be listened to.”
