Vessent, Treasury Secretary: "Procedures to find Powell's successor as Fed Chair have begun"

"This is President Trump's decision and will proceed at his pace"

Scott Vessent, United States Secretary of the Treasury, stated that 'official procedures' to find Jerome Powell's successor as Federal Reserve Board (Fed) Chair have already begun. He also suggested that, aside from the term as Fed Chair, which expires in May next year, Powell should also step down from his position as a fed governor, which lasts until January 2028.

In an interview with Bloomberg on the morning of the 15th (local time), Secretary Vessent responded as such when asked whether such efforts had already begun. He said, "There are many excellent candidates, so we will have to see how quickly this process will proceed," adding, "This is President Trump's decision and will proceed at his pace."

Vessent also said that it would be confusing for Powell to remain at the Fed as a governor after finishing his term as Chair. Vessent added, "Traditionally, the Fed Chair also resigns from the governor position, and there has been much talk that the nomination of a new Fed Chair could cause confusion," adding, "If a former Fed Chair continues as a Fed Chair, it would be very confusing for the markets."

Typically, the Fed Chair is selected from among the Fed governors. While Powell's term as Chair ends in June next year, his governor position expires at the end of January 2028.

Wall Street analysts have anticipated that if the Trump administration dismisses Jerome Powell as Fed Chair and undermines the Fed's independence, this could spark increased selling of the United States dollar and US treasuries.

On this day, the yield on the United States 10-year treasury note, which had been trending downward in the early morning in Eastern Time, reversed to rise at 4.429% as of around 7:45 AM Eastern Time. The 2-year treasury yield rose by 2 basis points (1bp=0.01%) to 3.919%.

Contributing Reporter Kim Jung-ah kja@hankyung.com