Trump to Name Successors at Fed and BLS
President Donald Trump is preparing to appoint replacements for two critical vacancies—one at the Federal Reserve and another at the Bureau of Labor Statistics (BLS)—with announcements expected within the next few days.
The Fed opening emerged after Governor Adriana Kugler submitted her resignation on Friday, and the BLS vacancy followed Trump’s decision to dismiss Commissioner Erika McEntarfer. Trump confirmed to reporters on Sunday that he is considering multiple candidates for both roles and plans to reveal his selections soon.
Why the Fed Position is Crucial
Adriana Kugler’s resignation takes effect on August 8, months before her term was due to expire in January. As a sitting Fed governor, she was a full voting member of the Federal Open Market Committee (FOMC) and played a role in steering U.S. monetary policy, especially under Chair Jerome Powell.
Trump has made it clear that future Fed appointees will be evaluated based on their willingness to support rate cuts. According to Krishna Guha of Evercore ISI, this vacancy could accelerate what many are calling the “Trumpification” of the Fed—potentially influencing long-term leadership choices. Rumored candidates include former Fed Governor Kevin Warsh, Treasury Secretary Scott Bessent, and NEC Director Kevin Hassett.
Controversy Surrounds McEntarfer’s BLS Departure
Adding to the shake-up, Trump terminated Erika McEntarfer shortly after the release of the July nonfarm payroll report that revealed only 73,000 jobs added—and downward revisions totaling 258,000 jobs for May and June. On his social platform, Trump labeled the report “the biggest miscalculations in over 50 years.”
While data revisions are typical as more information is gathered, the frequency and size of recent adjustments have raised eyebrows. Just last year, the BLS revised its count downward by 818,000 jobs for the preceding 12 months—partly attributed to declining survey participation.
Calls for Overhauling BLS and Data Transparency
In the aftermath, officials have emphasized the need for reform. Kevin Hassett, speaking on CNBC, stated, “We need fresh eyes to modernize labor data—make it transparent and reliable enough for markets to trust.”
However, concerns are mounting that politicizing leadership at the BLS could undermine its independence. Michael Feroli, JPMorgan Chase’s chief U.S. economist, warned: “The risk of politicizing the data process is real—faulty instruments can be as dangerous as a steering bias in policy decisions.”
While Trump has not disclosed McEntarfer’s successor, Deputy Commissioner William Wiatrowski is currently serving in an acting capacity.
Potential Implications for Monetary Policy
The upcoming appointments will likely influence Fed direction at a critical juncture. With inflation lingering and economic data flagging, markets are watching for potential slowdowns or rate adjustments. A nominee aligned with Trump’s views could push for more aggressive rate cuts, challenging existing Fed strategy and Powell’s leadership.
Similarly, the choice of BLS commissioner could shape how labor statistics are reported and interpreted—crucial for both markets and policymakers.
Key Questions Ahead
Several issues remain unresolved:
- Will the Fed pick support immediate rate reductions?
- Can the next BLS leader maintain data credibility and independence?
- What broader impacts will these changes have on investor trust and policy transparency?
These choices could shape monetary and economic policymaking well beyond 2025.
A Defining Moment in Economic Governance
Both leadership changes come with significant stakes. Whether Trump’s upcoming appointees reinforce or reshape U.S. economic direction remains to be seen. The selections for the Federal Reserve and Bureau of Labor Statistics could determine how data is collected, interpreted, and used—affecting everything from interest rates to public confidence in economic reporting.
Reference : Jeff Cox